Reviewing Amplitude (NASDAQ:AMPL) and Allot (NASDAQ:ALLT)

Amplitude (NASDAQ:AMPL) and Allot (NASDAQ:ALLT) are both small-cap business services companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, profitability, institutional ownership and earnings.

Risk and Volatility

Amplitude has a beta of 1.51, meaning that its share price is 51% more volatile than the S&P 500. Comparatively, Allot has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500.

Insider & Institutional Ownership

73.2% of Amplitude shares are held by institutional investors. Comparatively, 51.5% of Allot shares are held by institutional investors. 4.8% of Amplitude shares are held by insiders. Comparatively, 3.4% of Allot shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Amplitude and Allot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Amplitude	-31.36%	-36.27%	-22.90%
Allot	1.06%	4.54%	2.32%

Analyst Ratings

This is a summary of recent recommendations and price targets for Amplitude and Allot, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amplitude	1	3	7	1	2.67
Allot	1	0	4	1	2.83

Amplitude currently has a consensus price target of $14.33, indicating a potential upside of 30.01%. Allot has a consensus price target of $12.75, indicating a potential upside of 42.86%. Given Allot’s stronger consensus rating and higher possible upside, analysts clearly believe Allot is more favorable than Amplitude.

Valuation & Earnings

This table compares Amplitude and Allot”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Amplitude	$299.27 million	4.93	-$94.32 million	($0.80)	-13.78
Allot	$98.51 million	4.39	-$5.87 million	$0.03	297.50

Allot has lower revenue, but higher earnings than Amplitude. Amplitude is trading at a lower price-to-earnings ratio than Allot, indicating that it is currently the more affordable of the two stocks.

Summary

Allot beats Amplitude on 9 of the 14 factors compared between the two stocks.

About Amplitude

Amplitude, Inc., together with its subsidiaries, provides a digital analytics platform that analyzes customer behavior in the United States and internationally. It offers Amplitude Analytics, which provides real-time product data and reconstructed user visits; Amplitude Experiment, a solution that allows teams to test new capabilities and safely roll out new features; Amplitude CDP, an insight-driven solution that encompasses the data infrastructure, audience management, and data streaming capabilities; and Amplitude Session Replay used by product, marketing, and data teams to understand user behavior, diagnose product issues, and improve product outcomes. The company also provides customer support services related to initial implementation setup, ongoing support, and application training. It delivers its application over the Internet as a subscription service using a software-as-a-service model. The company was formerly known as Sonalight, Inc. and changed its name to Amplitude, Inc. in December 2014. Amplitude, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.

About Allot

Allot Communications Ltd. is a provider of leading innovative network intelligence and security solutions for service providers worldwide, enhancing value to their customers. Their solutions are deployed globally for network and application analytics, traffic control and shaping, network-based security services, and more. Allot’s multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises. Their industry leading network-based security as a service solution has achieved over 50% penetration with some service providers and is already used by over 20 million subscribers in Europe.