Contrasting Unity Software (NYSE:U) & Riskified (NYSE:RSKD)

Riskified (NYSE:RSKD) and Unity Software (NYSE:U) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, earnings, profitability and valuation.

Insider & Institutional Ownership

59.0% of Riskified shares are held by institutional investors. Comparatively, 73.5% of Unity Software shares are held by institutional investors. 17.4% of Riskified shares are held by company insiders. Comparatively, 3.6% of Unity Software shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Riskified and Unity Software’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Riskified	-11.04%	-8.12%	-6.22%
Unity Software	-24.15%	-9.45%	-4.50%

Analyst Ratings

This is a summary of recent ratings and price targets for Riskified and Unity Software, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Riskified	2	3	3	0	2.13
Unity Software	2	8	12	2	2.58

Riskified currently has a consensus target price of $5.89, suggesting a potential upside of 27.14%. Unity Software has a consensus target price of $45.27, suggesting a potential upside of 10.51%. Given Riskified’s higher possible upside, research analysts clearly believe Riskified is more favorable than Unity Software.

Risk & Volatility

Riskified has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500. Comparatively, Unity Software has a beta of 2.04, indicating that its stock price is 104% more volatile than the S&P 500.

Earnings & Valuation

This table compares Riskified and Unity Software”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Riskified	$327.52 million	2.28	-$34.92 million	($0.23)	-20.15
Unity Software	$1.81 billion	9.67	-$664.11 million	($1.05)	-39.01

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

Summary

Unity Software beats Riskified on 8 of the 15 factors compared between the two stocks.

About Riskified

Riskified Ltd., together with its subsidiaries, develops and offers an e-commerce risk management platform that allows online merchants to create trusted relationships with consumers in the United States, Europe, the Middle East, Africa, the Asia-Pacific, and the Americas. It offers Chargeback Guarantee that ensures the legitimacy of merchants' online orders; Policy Protect, a machine learning solution designed to detect and prevent refund and returns policy abuse in real-time; Account Secure, a solution that cross-checks every login attempt; Dispute Resolve, which is used to compile submissions for fraud and non-fraud related chargeback issues; and PSD2 Optimize that helps merchants avoid bank authorization failures and abandoned shopping carts. The company serves direct-to-consumer brands, online-only retailers, omnichannel retailers, online marketplaces, and e-commerce service providers in various industries, such as payments, money transfer and crypto, tickets and travel, electronics, home, and fashion and luxury goods. Riskified Ltd. was incorporated in 2012 and is headquartered in Tel Aviv, Israel.

About Unity Software

Unity Software Inc. operates a real-time 3D development platform. Its platform provides software solutions to create, run, and monetize interactive, real-time 2D and 3D content for mobile phones, tablets, PCs, consoles, and augmented and virtual reality devices. The company offers its solutions directly through its online store and field sales operations in North America, Denmark, Finland, the United Kingdom, Germany, Japan, China, Singapore, and South Korea, as well as indirectly through independent distributors and resellers worldwide. The company was founded in 2004 and is headquartered in San Francisco, California.