TrueCar (NASDAQ: TRUE) and Yext (NYSE:YEXT) are both small-cap computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.

Valuation & Earnings

This table compares TrueCar and Yext’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TrueCar $277.51 million 4.18 -$41.70 million ($0.36) -32.22
Yext $124.26 million 8.59 -$43.15 million N/A N/A

TrueCar has higher revenue and earnings than Yext.

Profitability

This table compares TrueCar and Yext’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TrueCar -10.29% -10.38% -8.12%
Yext -40.63% -157.17% -38.67%

Insider and Institutional Ownership

92.2% of TrueCar shares are owned by institutional investors. Comparatively, 28.6% of Yext shares are owned by institutional investors. 15.5% of TrueCar shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for TrueCar and Yext, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TrueCar 0 3 6 0 2.67
Yext 0 2 3 0 2.60

TrueCar presently has a consensus target price of $17.44, suggesting a potential upside of 50.38%. Yext has a consensus target price of $16.20, suggesting a potential upside of 38.46%. Given TrueCar’s stronger consensus rating and higher possible upside, analysts clearly believe TrueCar is more favorable than Yext.

Summary

TrueCar beats Yext on 10 of the 11 factors compared between the two stocks.

TrueCar Company Profile

TrueCar, Inc. is an Internet-based information, technology, and communication services company. The Company has a data-driven online platform, which features market data and analytics. The Company-branded platform is available on its TrueCar Website and mobile applications. It customizes and operates its platform on a co-branded basis for its affinity group marketing partners, including financial institutions, membership-based organizations, and employee buying programs for a range of enterprises. The Company enables users to obtain market-based pricing data on new and used cars, and to connect with its network of TrueCar Certified Dealers. Its network of over 13,000 TrueCar Certified Dealers consists primarily of new car franchises, as well as independent dealers selling used vehicles. Its subsidiary, ALG, Inc., provides forecasts and consulting services regarding determination of the residual value of an automobile at given future points in time.

Yext Company Profile

Yext Inc. is a knowledge engine provider. Yext puts business on the map. The Yext Knowledge Engine enables companies to manage their digital knowledge in the cloud and sync it to over 100 services in the PowerListings Network, including Apple Maps, Bing, Cortana, Facebook, Google, Google Maps, Instagram, Siri and Yelp. Yext Listings, Pages and Reviews help businesses around the globe and facilitate face-to-face digital interactions. Yext Knowledge Engine enables businesses to control and manage their digital knowledge and makes it available through the PowerListings Network of over 100 third-party maps, apps, search engines, intelligent GPS systems, digital assistants, vertical directories and social networks in a complete, up to date and accurate manner.

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