E2open (NASDAQ: EOPN) and GTT Communications (NYSE:GTT) are both small-cap cloud computing services companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, valuation, earnings, risk and dividends.

Analyst Recommendations

This is a summary of current ratings and price targets for E2open and GTT Communications, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
E2open 0 0 0 0 N/A
GTT Communications 0 0 4 0 3.00

GTT Communications has a consensus price target of $36.75, indicating a potential upside of 4.11%. Given GTT Communications’ higher possible upside, analysts clearly believe GTT Communications is more favorable than E2open.

Profitability

This table compares E2open and GTT Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
E2open -44.99% -74.59% -31.05%
GTT Communications -3.78% 2.09% 0.29%

Institutional and Insider Ownership

59.6% of GTT Communications shares are owned by institutional investors. 25.7% of GTT Communications shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares E2open and GTT Communications’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
E2open N/A N/A N/A ($1.12) -7.67
GTT Communications $521.70 million 2.80 $5.26 million ($0.56) -63.04

GTT Communications has higher revenue and earnings than E2open. GTT Communications is trading at a lower price-to-earnings ratio than E2open, indicating that it is currently the more affordable of the two stocks.

Summary

GTT Communications beats E2open on 9 of the 9 factors compared between the two stocks.

E2open Company Profile

E2open, LLC is a United States-based provider of supply chain operating network. The Company’s suite of collaborative supply chain solutions include multi-enterprise cloud connectivity, visibility and collaboration, supply management, sensing and planning, replenishment and fulfillment, quality and traceability, supply chain finance, and analytics and visualization. Its multi-enterprise cloud connectivity solution is the network that connects all trading partners, allowing companies to exchange information and work collaboratively, securely and in real time. Its visibility and collaboration solutions provide end-to-end supply chain visibility. Its supply management solutions provide visibility, control and collaborative capabilities across all buy-side processes. Its sensing and planning solutions allow customers to respond to changes at any level of their multi-enterprise supply chain. Its replenishment and fulfillment solutions give customers the visibility and planning support.

GTT Communications Company Profile

GTT Communications, Inc. provides cloud networking services to a range of clients. The Company offers a portfolio of global communications services, wide area network (WAN) services; Internet services; managed network and security services, and voice and unified communication services. It provides Layer 2 (Ethernet) and Layer 3 (multiprotocol label switching (MPLS)) WAN solutions for multinational clients. It offers customers with high-bandwidth global Internet connectivity and Internet protocol (IP) transit with availability and packet delivery. The Company offers managed network services, including managed equipment, managed security services and managed remote access. Its Session Initiation Protocol (SIP) Trunking service is an enterprise-built unified communications offering that integrates voice, video and chat onto a single IP connection. As of December 31, 2016, it had provided services to multinational enterprises, carriers and government customers in over 100 countries.

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