Analyzing HubSpot (NYSE:HUBS) and Workiva (NYSE:WK)

Workiva (NYSE:WK) and HubSpot (NYSE:HUBS) are both mid-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Profitability

This table compares Workiva and HubSpot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Workiva	-18.83%	N/A	-17.66%
HubSpot	-10.81%	-10.68%	-3.70%

Analyst Recommendations

This is a summary of recent ratings for Workiva and HubSpot, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Workiva	1	0	4	0	2.60
HubSpot	0	7	13	0	2.65

Workiva presently has a consensus target price of $41.60, indicating a potential downside of 31.52%. HubSpot has a consensus target price of $189.76, indicating a potential upside of 5.59%. Given HubSpot’s stronger consensus rating and higher possible upside, analysts plainly believe HubSpot is more favorable than Workiva.

Earnings & Valuation

This table compares Workiva and HubSpot’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Workiva	$244.34 million	11.23	-$50.07 million	($0.93)	-65.32
HubSpot	$512.98 million	14.75	-$63.82 million	($1.02)	-176.19

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

Institutional & Insider Ownership

51.5% of Workiva shares are owned by institutional investors. Comparatively, 94.6% of HubSpot shares are owned by institutional investors. 18.5% of Workiva shares are owned by company insiders. Comparatively, 8.3% of HubSpot shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Workiva has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, HubSpot has a beta of 1.71, suggesting that its share price is 71% more volatile than the S&P 500.

Summary

HubSpot beats Workiva on 9 of the 14 factors compared between the two stocks.

About Workiva

Workiva Inc. provides cloud-based solutions for connected data, reporting, and compliance worldwide. The company offers Wdesk, a platform that provides data collection and linking, data integrations, controlled collaboration, granular permissions, process management, and full audit trail services; and Wdata, which includes data preparation tools, data connectors, and application programming interfaces that enable customers to create direct connections to their data. It serves public and private companies, government agencies, and higher-education institutions. The company was founded in 2008 and is headquartered in Ames, Iowa.

About HubSpot

HubSpot, Inc. provides a cloud-based marketing and sales software platform for businesses in the Americas, Europe, and the Asia Pacific. The company’s software platform includes integrated applications, such as customer relationship management, search engine optimization, blogging, Website content management, messaging, chatbots, social media, marketing automation, email, predictive lead scoring, sales productivity, ticketing and helpdesk tools, customer NPS surveys, analytics, and reporting. It also offers professional, as well as phone and/or email and chat based support services. It serves mid-market business-to-business companies. The company markets its products through inbound go-to-market approach, marketing agency, and sales partners. HubSpot, Inc. was founded in 2005 and is headquartered in Cambridge, Massachusetts.

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