Critical Review: ZipRecruiter (NYSE:ZIP) versus ZoomInfo Technologies (NASDAQ:ZI)

ZoomInfo Technologies (NASDAQ:ZI) and ZipRecruiter (NYSE:ZIP) are both small-cap communication services companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, analyst recommendations, earnings and profitability.

Insider and Institutional Ownership

95.5% of ZoomInfo Technologies shares are owned by institutional investors. Comparatively, 70.6% of ZipRecruiter shares are owned by institutional investors. 9.0% of ZoomInfo Technologies shares are owned by company insiders. Comparatively, 19.9% of ZipRecruiter shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares ZoomInfo Technologies and ZipRecruiter”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ZoomInfo Technologies	$1.21 billion	1.10	$107.30 million	$0.12	32.50
ZipRecruiter	$448.95 million	0.78	-$32.99 million	$0.35	12.16

ZoomInfo Technologies has higher revenue and earnings than ZipRecruiter. ZipRecruiter is trading at a lower price-to-earnings ratio than ZoomInfo Technologies, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings for ZoomInfo Technologies and ZipRecruiter, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ZoomInfo Technologies	2	2	1	0	1.80
ZipRecruiter	1	3	0	0	1.75

ZoomInfo Technologies currently has a consensus target price of $5.50, suggesting a potential upside of 41.03%. ZipRecruiter has a consensus target price of $4.17, suggesting a potential downside of 2.08%. Given ZoomInfo Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe ZoomInfo Technologies is more favorable than ZipRecruiter.

Profitability

This table compares ZoomInfo Technologies and ZipRecruiter’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ZoomInfo Technologies	0.74%	12.05%	3.46%
ZipRecruiter	6.20%	N/A	-3.73%

Risk and Volatility

ZoomInfo Technologies has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500. Comparatively, ZipRecruiter has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500.

Summary

ZoomInfo Technologies beats ZipRecruiter on 10 of the 14 factors compared between the two stocks.

About ZoomInfo Technologies

ZoomInfo Technologies Inc., together with its subsidiaries, provides go-to-market intelligence and engagement platform for sales and marketing teams in the United States and internationally. The company's cloud-based platform provides information on organizations and professionals to help users identify target customers and decision makers, obtain continually updated predictive lead and company scoring, monitor buying signals and other attributes of target companies, craft messages, engage through automated sales tools, and track progress through the deal cycle. It serves enterprises, mid-market companies, and down to small businesses that operate in various industry, including software, business services, manufacturing, telecommunications, financial services, media and internet, transportation, education, hospitality, and real estate. The company was founded in 2007 and is headquartered in Vancouver, Washington.

About ZipRecruiter

ZipRecruiter, Inc. operates an online employment marketplace that connects job seekers and employers. Its platform provides various solutions, such as job posting, online interviews, job alerts, match scores, and application updates. The company was incorporated in 2010 and is based in Santa Monica, California.