Twilio (NYSE: TWLO) and Perion Network (NASDAQ:PERI) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, risk and institutional ownership.

Institutional & Insider Ownership

60.1% of Twilio shares are owned by institutional investors. Comparatively, 19.4% of Perion Network shares are owned by institutional investors. 25.0% of Twilio shares are owned 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.

Risk and Volatility

Twilio has a beta of 2.43, suggesting that its share price is 143% more volatile than the S&P 500. Comparatively, Perion Network has a beta of 1.79, suggesting that its share price is 79% more volatile than the S&P 500.

Profitability

This table compares Twilio and Perion Network’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Twilio -15.69% -17.55% -14.06%
Perion Network -12.50% 7.83% 4.54%

Earnings and Valuation

This table compares Twilio and Perion Network’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Twilio $277.33 million 8.38 -$41.32 million ($0.64) -39.05
Perion Network $312.79 million 0.26 $200,000.00 ($0.45) -2.29

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

Analyst Ratings

This is a breakdown of current recommendations and price targets for Twilio and Perion Network, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Twilio 1 2 13 0 2.75
Perion Network 0 1 0 0 2.00

Twilio currently has a consensus target price of $37.14, indicating a potential upside of 48.63%. Given Twilio’s stronger consensus rating and higher possible upside, analysts plainly believe Twilio is more favorable than Perion Network.

Summary

Twilio beats Perion Network on 7 of the 13 factors compared between the two stocks.

About Twilio

Twilio Inc. offers Cloud Communications Platform, which enables developers to build, scale and operate real-time communications within software applications. The Company’s platform consists of Programmable Communications Cloud, Super Network and Business Model for Innovators. Its Programmable Communications Cloud software enables developers to embed voice, messaging, video and authentication capabilities into their applications through its Application Programming Interfaces (APIs). Its Programmable Communications Cloud offers building blocks that enable its customers to build what they need. Its Programmable Communications Cloud includes Programmable Voice, Programmable Messaging, Programmable Video and Use Case APIs. The Super Network is its software layer that allows its customers’ software to communicate with connected devices globally. It interconnects with communications networks around the world.

About Perion Network

Perion Network Ltd. is a global technology company. It is engaged in delivering advertising solutions to brands and publishers. It operates through High Impact Advertising solutions segment. It provides execution, ranging from high-impact advertisement formats to branded search, and a unified social and mobile programmatic platform. Its business solutions include Undertone, Codefuel, Growmobile, IncrediMail and Smilebox. Undertone offers engaging digital advertising, which is designed to capture consumer attention and drive engagement, delivering these advertisements across a portfolio of Websites and mobile applications. CodeFuel is an engagement and monetization suite delivering solutions for both content publishers and advertisers. Growmobile offers automated marketing solutions ranging from social advertising to user engagement. IncrediMail is a unified messaging application. Smilebox is a photo sharing and social expression product and offers various formats, themes and styles.

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