Okta (NASDAQ:OKTA) and Activision Blizzard (NASDAQ:ATVI) are both large-cap computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, earnings, profitability, valuation and institutional ownership.
Profitability
This table compares Okta and Activision Blizzard's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Okta | -31.38% | -31.29% | -6.65% |
| Activision Blizzard | 28.90% | 19.07% | 12.65% |
Volatility and Risk
Okta has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Activision Blizzard has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500.
Valuation and Earnings
This table compares Okta and Activision Blizzard's revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Okta | $586.07 million | 59.62 | $-208,910,000.00 | ($1.39) | -194.17 |
| Activision Blizzard | $6.49 billion | 11.40 | $1.50 billion | $2.08 | 46.00 |
Activision Blizzard has higher revenue and earnings than Okta. Okta is trading at a lower price-to-earnings ratio than Activision Blizzard, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
75.8% of Okta shares are held by institutional investors. Comparatively, 85.8% of Activision Blizzard shares are held by institutional investors. 12.0% of Okta shares are held by company insiders. Comparatively, 1.1% of Activision Blizzard shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Okta and Activision Blizzard, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Okta | 0 | 8 | 12 | 0 | 2.60 |
| Activision Blizzard | 0 | 3 | 25 | 0 | 2.89 |
Okta currently has a consensus price target of $255.05, suggesting a potential downside of 5.57%. Activision Blizzard has a consensus price target of $103.00, suggesting a potential upside of 7.53%. Given Activision Blizzard's stronger consensus rating and higher possible upside, analysts clearly believe Activision Blizzard is more favorable than Okta.
Summary
Activision Blizzard beats Okta on 11 of the 14 factors compared between the two stocks.
