Comparing Callidus Software (CALD) & Nuance Communications (NUAN)

Callidus Software (NASDAQ: CALD) and Nuance Communications (NASDAQ:NUAN) are both mid-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, earnings, analyst recommendations, profitability and risk.

Profitability

This table compares Callidus Software and Nuance Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Callidus Software -9.54% -5.67% -3.39%
Nuance Communications -7.75% 12.15% 3.94%

Analyst Recommendations

This is a summary of recent ratings for Callidus Software and Nuance Communications, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Callidus Software 0 1 9 0 2.90
Nuance Communications 0 1 6 1 3.00

Callidus Software presently has a consensus target price of $30.11, suggesting a potential downside of 0.46%. Nuance Communications has a consensus target price of $20.86, suggesting a potential upside of 22.04%. Given Nuance Communications’ stronger consensus rating and higher probable upside, analysts clearly believe Nuance Communications is more favorable than Callidus Software.

Volatility and Risk

Callidus Software has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500. Comparatively, Nuance Communications has a beta of 0.6, meaning that its stock price is 40% less volatile than the S&P 500.

Institutional and Insider Ownership

92.1% of Callidus Software shares are owned by institutional investors. Comparatively, 84.9% of Nuance Communications shares are owned by institutional investors. 1.6% of Callidus Software shares are owned by insiders. Comparatively, 1.7% of Nuance Communications shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Callidus Software and Nuance Communications’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Callidus Software $206.72 million 9.97 -$18.96 million ($0.35) -86.43
Nuance Communications $1.98 billion 2.51 -$150.99 million ($0.52) -32.87

Callidus Software has higher earnings, but lower revenue than Nuance Communications. Callidus Software is trading at a lower price-to-earnings ratio than Nuance Communications, indicating that it is currently the more affordable of the two stocks.

Summary

Nuance Communications beats Callidus Software on 9 of the 15 factors compared between the two stocks.

About Callidus Software

Callidus Software Inc. (Callidus) is a provider of cloud-based sales, marketing, learning and customer experience solutions. The Company’s CallidusCloud enables its customers to manage their Lead to Money process with a suite of solutions that identify leads, implement territory and quota plans, enable sales forces, automate bid configuration pricing and quoting, manage contracts, streamline sales compensation and capture customer feedback, among others. Lead to Money is a process designed to help companies respond to the changing role of sales and marketing in the redefined buying cycle. The company’s Lead to Money suite and technology solutions include Lead, Planning, Enablement, Quotes and Proposals, Contracts, Incentives, Customer Experience and Technology. The Company provides a range of services to its customers, which include professional services, business process outsourcing services, maintenance and technical support services, and education services.

About Nuance Communications

Nuance Communications, Inc. is a provider of voice recognition and natural language understanding solutions. The Company’s segments include Healthcare, Mobile, Enterprise and Imaging. The Healthcare segment provides clinical speech and clinical language understanding solutions. The solutions for the Healthcare segment include transcription solutions, Dragon Medical, and clinical document improvement (CDI) and coding solutions. Its Mobile segment provides a portfolio of specialized virtual assistants and connected services. The Enterprise segment provides automated customer solutions and services. The solutions for the Enterprise segment include On-Premise solutions and services, and On-Demand multichannel cloud. The Imaging segment provides software solutions that help professionals and organizations to gain control of their document and information processes. Imaging segment include multi-function printer (MFP) scan automation solutions and MFP Print automation solutions.

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