ServiceNow (NYSE:NOW) and Twilio (NYSE:TWLO) are both large-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.
Institutional & Insider Ownership
90.1% of ServiceNow shares are owned by institutional investors. Comparatively, 84.0% of Twilio shares are owned by institutional investors. 1.0% of ServiceNow shares are owned by insiders. Comparatively, 6.7% of Twilio shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Earnings and Valuation
This table compares ServiceNow and Twilio's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| ServiceNow | $3.46 billion | 27.80 | $626.70 million | $0.65 | 771.71 |
| Twilio | $1.13 billion | 37.93 | $-307,060,000.00 | ($1.83) | -164.27 |
ServiceNow has higher revenue and earnings than Twilio. Twilio is trading at a lower price-to-earnings ratio than ServiceNow, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of current ratings and price targets for ServiceNow and Twilio, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| ServiceNow | 0 | 5 | 22 | 1 | 2.86 |
| Twilio | 0 | 4 | 19 | 0 | 2.83 |
ServiceNow presently has a consensus price target of $479.4167, indicating a potential downside of 4.42%. Twilio has a consensus price target of $299.8261, indicating a potential downside of 0.26%. Given Twilio's higher probable upside, analysts plainly believe Twilio is more favorable than ServiceNow.
Profitability
This table compares ServiceNow and Twilio's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| ServiceNow | 18.42% | 11.09% | 3.92% |
| Twilio | -26.77% | -5.04% | -4.17% |
Volatility & Risk
ServiceNow has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500. Comparatively, Twilio has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500.
Summary
ServiceNow beats Twilio on 11 of the 15 factors compared between the two stocks.
