Head to Head Review: Qihoo 360 Technology (QIHU) & Inovalon (INOV)

Qihoo 360 Technology (NYSE: QIHU) and Inovalon (NASDAQ:INOV) are both mid-cap technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, valuation, institutional ownership and dividends.

Profitability

This table compares Qihoo 360 Technology and Inovalon’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Qihoo 360 Technology 17.95% 30.01% 9.81%
Inovalon 4.07% 4.63% 2.99%

Institutional and Insider Ownership

28.1% of Inovalon shares are owned by institutional investors. 48.3% of Inovalon shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for Qihoo 360 Technology and Inovalon, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Qihoo 360 Technology 0 0 0 0 N/A
Inovalon 1 4 0 0 1.80

Inovalon has a consensus price target of $12.00, indicating a potential downside of 11.76%. Given Inovalon’s higher possible upside, analysts clearly believe Inovalon is more favorable than Qihoo 360 Technology.

Earnings and Valuation

This table compares Qihoo 360 Technology and Inovalon’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Qihoo 360 Technology N/A N/A N/A $2.14 35.94
Inovalon $427.59 million 4.64 $27.10 million $0.12 113.33

Inovalon has higher revenue and earnings than Qihoo 360 Technology. Qihoo 360 Technology is trading at a lower price-to-earnings ratio than Inovalon, indicating that it is currently the more affordable of the two stocks.

Summary

Inovalon beats Qihoo 360 Technology on 5 of the 9 factors compared between the two stocks.

About Qihoo 360 Technology

Qihoo 360 Technology Co. Ltd. is a China-based company principally engaged in the operations of Internet services. The Company’s segments include Internet services, smart hardware and IOT devices. The Company’s Internet and mobile security products include 360 Safe Guard, 360 Anti-virus and 360 Mobile Safe. The Company is also involved in the development of various platform products to meet a range of security-related needs of Internet users and create access points to the Internet, which include 360 browsers; 360 Personal Start-up Page and its subpages; 360 Search, and 360 Mobile Assistant. The Company also provides online advertising service solutions, such as sponsored links (advertising links), on its platform products, such as 360 Personal Start-up Page, 360 Search and 360 Mobile Assistant; Internet value-added services; Internet of things (IOT) devices, and other services. It also serves as an agent for providing online distribution services and payment collections services.

About Inovalon

Inovalon Holdings, Inc. (Inovalon) is a technology company. The Company provides cloud-based platforms empowering a data-driven transformation from volume-based to value-based models to the healthcare industry. Leveraging large-scale data interconnectivity capabilities, unparalleled proprietary data sets, advanced analytics, data-driven intervention systems, and subject matter expertise, Inovalon enables the assessment and improvement of clinical and quality outcomes and financial performance across the healthcare ecosystem. The Company serves clients across the healthcare industry, which includes health plans and provider organizations, pharmaceutical, medical device, and diagnostics companies. It provides technology that supports approximately 500 healthcare organizations. Inovalon’s platforms are informed by data pertaining to more than 858,000 physicians, 377,000 clinical facilities, and more than 230 million Americans.

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