Q2 Holdings (NYSE: QTWO) and MicroStrategy (NASDAQ:MSTR) are both small-cap technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitabiliy, earnings and institutional ownership.

Risk & Volatility

Q2 Holdings has a beta of 1.6, meaning that its share price is 60% more volatile than the S&P 500. Comparatively, MicroStrategy has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500.

Earnings & Valuation

This table compares Q2 Holdings and MicroStrategy’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Q2 Holdings $172.62 million 8.99 -$16.91 million ($0.79) -47.59
MicroStrategy $511.19 million 2.96 $109.23 million $7.24 18.25

MicroStrategy has higher revenue and earnings than Q2 Holdings. Q2 Holdings is trading at a lower price-to-earnings ratio than MicroStrategy, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Q2 Holdings and MicroStrategy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Q2 Holdings 0 0 7 0 3.00
MicroStrategy 0 4 1 0 2.20

Q2 Holdings currently has a consensus price target of $42.14, indicating a potential upside of 12.08%. MicroStrategy has a consensus price target of $180.00, indicating a potential upside of 36.23%. Given MicroStrategy’s higher probable upside, analysts plainly believe MicroStrategy is more favorable than Q2 Holdings.

Insider & Institutional Ownership

94.0% of Q2 Holdings shares are held by institutional investors. Comparatively, 78.4% of MicroStrategy shares are held by institutional investors. 24.5% of Q2 Holdings shares are held by company insiders. Comparatively, 21.8% of MicroStrategy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Q2 Holdings and MicroStrategy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Q2 Holdings -16.42% -31.26% -16.30%
MicroStrategy 16.37% 14.99% 10.84%

Summary

MicroStrategy beats Q2 Holdings on 7 of the 13 factors compared between the two stocks.

About Q2 Holdings

Q2 Holdings, Inc. is a provider of cloud-based digital banking solutions. The Company enables regional and community financial institutions (RCFIs), to deliver a suite of integrated digital banking services. The Company’s solutions all operate on a common platform that supports the delivery of unified digital banking services across online, mobile and voice channels. Its platform provides a single point of management enabling RCFIs to deliver targeted experiences, including tailored rights, features and branding to account holders. Its cloud-based solutions and common platform provide its RCFI customers with a view of account holder access and activity across devices and channels. Its solutions include Q2online, Q2 Risk & Fraud Analytics, Q2 Corporate, Q2 SMART, Q2mobility Application, Q2mobile Remote Deposit Capture, Q2text, Q2themes, Q2clarity, Centrix Dispute Tracking System (DTS), Centrix Payments I.Q. System (PIQS), and Centrix Exact/Transaction Management System (Exact/TMS).

About MicroStrategy

MicroStrategy Incorporated is a provider of enterprise software platforms around the world. The Company is engaged in the design, development, marketing and sales of its software platform through licensing arrangements, and cloud-based subscriptions and related services. It focuses on providing enterprise customers with software platform and services for deploying intelligence applications. Its platform, MicroStrategy 10, consolidates analytics and mobility in a single platform, available both as on-premise software and as a hosted service offering in MicroStrategy Cloud. Its enterprise platform combines business intelligence functionality with data discovery, mobile analytics and identity intelligence generated by digital credentials. MicroStrategy 10 consists of MicroStrategy Analytics, MicroStrategy Mobile and Usher. MicroStrategy Analytics offers solutions to organizations to analyze a range of data and distribute actionable business insight throughout an enterprise.

Receive News & Ratings for Q2 Holdings Inc Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Q2 Holdings Inc and related companies with MarketBeat.com's FREE daily email newsletter.