AppFolio (NASDAQ: APPF) and DealerTrack Technologies (NASDAQ:TRAK) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, institutional ownership, valuation and profitability.

Institutional and Insider Ownership

17.7% of AppFolio shares are owned by institutional investors. 44.8% of AppFolio shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for AppFolio and DealerTrack Technologies, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AppFolio 0 3 2 0 2.40
DealerTrack Technologies 0 0 0 0 N/A

AppFolio presently has a consensus target price of $36.50, indicating a potential downside of 6.41%. Given AppFolio’s higher possible upside, equities analysts clearly believe AppFolio is more favorable than DealerTrack Technologies.

Profitability

This table compares AppFolio and DealerTrack Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AppFolio 0.84% 1.46% 1.12%
DealerTrack Technologies -3.45% -3.48% -1.59%

Earnings and Valuation

This table compares AppFolio and DealerTrack Technologies’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AppFolio $124.18 million 10.65 $4.64 million $0.03 1,300.43
DealerTrack Technologies N/A N/A N/A N/A N/A

AppFolio has higher revenue and earnings than DealerTrack Technologies.

Summary

AppFolio beats DealerTrack Technologies on 8 of the 8 factors compared between the two stocks.

About AppFolio

AppFolio, Inc. is a provider of industry-specific, cloud-based software solutions for small and medium-sized businesses (SMBs) in the property management and legal industries. The Company’s mobile-optimized software solutions enable its customers to work at any time and from anywhere across multiple devices. Its property management software provides small and medium-sized property managers with an end-to-end solution to their business needs. The Company’s legal software provides solo practitioners and small law firms with a streamlined practice and case management solution, allowing them to manage their practices and case load. It also offers Value+ services, such as its professionally designed Websites and electronic payment services. The Company’s property manager customers include third-party managers and owner-operators, managing single- and multi-family residences, commercial property and student housing, as well as mixed real estate portfolios.

About DealerTrack Technologies

Dealertrack Technologies, Inc. provides Web-based software solutions and services. The Company provides solutions and services for segments of the automotive retail industry, including dealers, lenders, original equipment manufacturers (OEMs), third-party retailers, aftermarket providers and other service providers. Dealertrack operates the online credit application networks in the United States and Canada. The Company’s solutions includes Digital Marketing solutions, Dealer Management solutions, F&I solutions, Inventory solutions, Registration & Titling solutions, and Collateral Management solutions. Digital Marketing solutions include digital marketing tools, such as desktop and mobile Website design, search engine optimization (SEO), search engine marketing (SEM), social media and reputation management tools. Registration & Titling solutions include online and cross-state vehicle registration services.

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