Medallia (NYSE:MDLA) and Pluralsight (NASDAQ:PS) are both mid-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.
Analyst Ratings
This is a summary of current ratings and recommmendations for Medallia and Pluralsight, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Medallia | 0 | 2 | 9 | 0 | 2.82 |
| Pluralsight | 1 | 14 | 3 | 0 | 2.11 |
Medallia presently has a consensus price target of $37.60, indicating a potential downside of 4.93%. Pluralsight has a consensus price target of $21.23, indicating a potential upside of 0.14%. Given Pluralsight's higher possible upside, analysts clearly believe Pluralsight is more favorable than Medallia.
Insider and Institutional Ownership
91.8% of Medallia shares are held by institutional investors. Comparatively, 80.5% of Pluralsight shares are held by institutional investors. 21.8% of Pluralsight shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Volatility and Risk
Medallia has a beta of 1.78, indicating that its stock price is 78% more volatile than the S&P 500. Comparatively, Pluralsight has a beta of 2.29, indicating that its stock price is 129% more volatile than the S&P 500.
Earnings and Valuation
This table compares Medallia and Pluralsight's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Medallia | $402.46 million | 14.78 | $-112,330,000.00 | ($1.35) | -29.30 |
| Pluralsight | $316.91 million | 9.75 | $-112,660,000.00 | ($0.98) | -21.63 |
Medallia has higher revenue and earnings than Pluralsight. Medallia is trading at a lower price-to-earnings ratio than Pluralsight, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Medallia and Pluralsight's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Medallia | -28.69% | -24.84% | -12.60% |
| Pluralsight | -33.16% | -57.42% | -12.33% |
Summary
Medallia beats Pluralsight on 8 of the 14 factors compared between the two stocks.
