Critical Survey: Barracuda Networks (CUDA) vs. Black Knight Financial Services (BKFS)

Barracuda Networks (NYSE: CUDA) and Black Knight Financial Services (NYSE:BKFS) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, risk, earnings and institutional ownership.

Institutional and Insider Ownership

75.7% of Barracuda Networks shares are held by institutional investors. Comparatively, 44.7% of Black Knight Financial Services shares are held by institutional investors. 13.9% of Barracuda Networks shares are held by insiders. Comparatively, 30.8% of Black Knight Financial Services shares are held by 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 breakdown of recent recommendations for Barracuda Networks and Black Knight Financial Services, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Barracuda Networks 0 9 3 0 2.25
Black Knight Financial Services 0 1 6 0 2.86

Barracuda Networks currently has a consensus price target of $28.51, indicating a potential upside of 3.48%. Black Knight Financial Services has a consensus price target of $46.50, indicating a potential upside of 8.01%. Given Black Knight Financial Services’ stronger consensus rating and higher possible upside, analysts plainly believe Black Knight Financial Services is more favorable than Barracuda Networks.

Earnings and Valuation

This table compares Barracuda Networks and Black Knight Financial Services’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Barracuda Networks $352.65 million 4.19 $10.23 million $0.28 98.39
Black Knight Financial Services N/A N/A N/A $0.63 68.33

Barracuda Networks has higher revenue and earnings than Black Knight Financial Services. Black Knight Financial Services is trading at a lower price-to-earnings ratio than Barracuda Networks, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Barracuda Networks and Black Knight Financial Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Barracuda Networks 4.09% 74.59% 2.98%
Black Knight Financial Services 16.64% 4.71% 4.71%

Summary

Black Knight Financial Services beats Barracuda Networks on 7 of the 11 factors compared between the two stocks.

About Barracuda Networks

Barracuda Networks, Inc. designs and delivers security and data protection solutions. The Company offers cloud-enabled solutions that enable customers to address security threats, manage network performance, and protect and store their data. Its solutions are designed to manage information technology operations for its customers. Its security solutions include Barracuda Email Security, The Barracuda Web Security Gateway, Barracuda NextGen Firewalls, The Barracuda Web Application Firewall, The Barracuda Load Balancer ADC and The Barracuda SSL VPN. Its data protection solutions provide solutions for on-premises and cloud-based archiving and backup. Its data protection solutions include Barracuda Backup, Barracuda Message Archiver and CudaSign. Its solution suites combine its security and data protection offerings into services designed for cloud platforms and managed services environments. Its solution suites include Barracuda Essentials for Office 365 and Intronis ECHOplatform.

About Black Knight Financial Services

Black Knight Financial Services, Inc. is a holding company. The Company, through its subsidiaries, provides integrated technology, workflow automation, and data and analytics to the mortgage and real estate industries. The Company’s segments include Technology, and Data and Analytics. The Company’s Technology segment offers software and hosting solutions that support loan servicing, loan origination and settlement services. The Technology segment provides applications and services, such as servicing technology and origination technology. Its Data and Analytics segment offers data and analytics solutions to the mortgage, real estate and capital markets industries. These solutions include property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, prepayment and default models, lead generation and other data solutions.

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