MaxPoint Interactive (NASDAQ: MXPT) and AppFolio (NASDAQ:APPF) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, dividends, risk and institutional ownership.

Profitability

This table compares MaxPoint Interactive and AppFolio’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MaxPoint Interactive -10.18% -45.24% -19.16%
AppFolio 0.84% 1.46% 1.12%

Analyst Recommendations

This is a summary of current ratings for MaxPoint Interactive and AppFolio, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MaxPoint Interactive 0 1 0 0 2.00
AppFolio 0 3 2 0 2.40

AppFolio has a consensus target price of $36.50, suggesting a potential downside of 28.29%. Given AppFolio’s stronger consensus rating and higher probable upside, analysts clearly believe AppFolio is more favorable than MaxPoint Interactive.

Earnings and Valuation

This table compares MaxPoint Interactive and AppFolio’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
MaxPoint Interactive $144.42 million 0.65 -$8.89 million ($2.21) -6.27
AppFolio $124.18 million 13.90 $4.64 million $0.03 1,697.23

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

Risk and Volatility

MaxPoint Interactive has a beta of 2.11, meaning that its share price is 111% more volatile than the S&P 500. Comparatively, AppFolio has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500.

Insider and Institutional Ownership

8.0% of MaxPoint Interactive shares are held by institutional investors. Comparatively, 20.9% of AppFolio shares are held by institutional investors. 57.1% of MaxPoint Interactive shares are held by company insiders. Comparatively, 44.8% of AppFolio shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

AppFolio beats MaxPoint Interactive on 10 of the 13 factors compared between the two stocks.

About MaxPoint Interactive

MaxPoint Interactive, Inc. is a marketing technology company. The Company provides business intelligence and marketing automation solution. The Company’s MaxPoint Intelligence Platform is a cloud-based software service that enables to predict local demand for national brands based on consumers’ purchase power and intent and manage customized digital advertisements containing in-store offers and promotions to reach consumers at a local level across display, mobile, social and video channels. Through marketing automation and direct integrations with real-time bidding (RTB) exchanges, the Company’s platform delivers customized digital advertisements containing product and store specific promotions to local consumers. The Company’s customers are located in the United States and Europe, and consist of enterprises with national brands in the consumer products, retail, automotive, financial services, healthcare, telecommunications and entertainment industries.

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.

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