Stem (NYSE:STEM – Get Free Report) and BlackLine (NASDAQ:BL – Get Free Report) are both small-cap technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, valuation, earnings and dividends.
Insider & Institutional Ownership
61.6% of Stem shares are held by institutional investors. Comparatively, 95.1% of BlackLine shares are held by institutional investors. 5.1% of Stem shares are held by company insiders. Comparatively, 9.1% of BlackLine shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares Stem and BlackLine”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Stem | $156.27 million | 0.15 | $137.76 million | ($8.49) | -0.28 |
| BlackLine | $700.43 million | 2.80 | $24.17 million | $0.57 | 59.14 |
Stem has higher earnings, but lower revenue than BlackLine. Stem is trading at a lower price-to-earnings ratio than BlackLine, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of current ratings and price targets for Stem and BlackLine, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Stem | 1 | 4 | 1 | 0 | 2.00 |
| BlackLine | 3 | 6 | 5 | 0 | 2.14 |
Stem currently has a consensus price target of $6.54, indicating a potential upside of 173.02%. BlackLine has a consensus price target of $39.50, indicating a potential upside of 17.18%. Given Stem’s higher possible upside, analysts clearly believe Stem is more favorable than BlackLine.
Profitability
This table compares Stem and BlackLine’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Stem | -49.37% | N/A | -21.85% |
| BlackLine | 4.75% | 20.89% | 4.19% |
Volatility & Risk
Stem has a beta of 1.58, meaning that its stock price is 58% more volatile than the S&P 500. Comparatively, BlackLine has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500.
Summary
BlackLine beats Stem on 11 of the 14 factors compared between the two stocks.
About Stem
Stem, Inc. operates as a digitally connected, intelligent, and renewable energy storage network provider worldwide. The company offers energy storage hardware sourced from original equipment manufacturers (OEMs); edge hardware to aid in the collection of site data and real-time operation and control of the site and other optional equipment; and Athena, a software platform, which offers battery hardware and software-enabled services to operate the energy storage systems. It serves commercial and industrial enterprises, independent power producers, renewable project developers, and utilities and grid operators. The company was incorporated in 2009 and is headquartered in San Francisco, California.
About BlackLine
BlackLine, Inc. operates a cloud-based software platform which is designed to transform accounting and finance operations for organizations of all types and sizes. Its scalable platform supports critical accounting processes such as the financial close, account reconciliations, intercompany accounting, and controls assurance. The company was founded by Therese Tucker in May 2001 and is headquartered in Woodland Hills, CA.
Receive News & Ratings for Stem Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Stem and related companies with MarketBeat.com's FREE daily email newsletter.
