Analyzing LivePerson (LPSN) & Endurance International Group (EIGI)

LivePerson (NASDAQ: LPSN) and Endurance International Group (NASDAQ:EIGI) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Profitability

This table compares LivePerson and Endurance International Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LivePerson -11.07% -4.41% -2.77%
Endurance International Group -12.74% -161.36% -5.51%

Volatility and Risk

LivePerson has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500. Comparatively, Endurance International Group has a beta of 1.98, suggesting that its share price is 98% more volatile than the S&P 500.

Institutional & Insider Ownership

75.9% of LivePerson shares are held by institutional investors. Comparatively, 86.4% of Endurance International Group shares are held by institutional investors. 11.7% of LivePerson shares are held by company insiders. Comparatively, 58.2% of Endurance International Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for LivePerson and Endurance International Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LivePerson 0 1 5 0 2.83
Endurance International Group 3 2 0 0 1.40

LivePerson currently has a consensus target price of $15.06, suggesting a potential upside of 35.05%. Endurance International Group has a consensus target price of $7.70, suggesting a potential downside of 9.41%. Given LivePerson’s stronger consensus rating and higher possible upside, equities analysts plainly believe LivePerson is more favorable than Endurance International Group.

Valuation and Earnings

This table compares LivePerson and Endurance International Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LivePerson $222.78 million 2.98 -$25.87 million ($0.42) -26.55
Endurance International Group $1.11 billion 1.10 -$72.83 million ($1.10) -7.73

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

Summary

LivePerson beats Endurance International Group on 9 of the 13 factors compared between the two stocks.

LivePerson Company Profile

LivePerson, Inc. (Liveperson) is a provider of mobile and online business messaging technologies that power digital communication between brands and consumers. The Company’s segments include Business and Consumer. The Business segment enables brands to leverage its cloud-based LiveEngage’s intelligence engine. The Consumer segment facilitates online transactions between independent service providers (Experts) and individual consumers (Users) seeking information and knowledge for a fee through mobile and online messaging. The Company’s platform, LiveEngage, enables businesses to create a meaningful connection with consumers by offering messaging as a preferred channel of communication. The Company’s products and services include LiveEngage, Professional Services and Consumer Offering. As a cloud computing or software-as-a-service (SaaS) provider, LivePerson provides solutions on a hosted basis. LiveEngage enables the combination of real time on-site data and off-site behavioral data.

Endurance International Group Company Profile

Endurance International Group Holdings, Inc. (Endurance) is a provider of cloud-based platform solutions designed to help small and medium-sized businesses (SMBs) succeed online. The Company operates through two segments: Web Presence and Email Marketing. The Company’s Web presence segment consists of Web hosting, domains and the related products and services. Its e-mail marketing segment consists of the products and services offered by Constant Contact, principally e-mail marketing, including event marketing, survey tools and SinglePlatform. The Company’s products focuses on Web hosting and other Web presence solutions, such as domains, and it also offers security, site backup, domains, search engine optimization (SEO) and search engine marketing (SEM), Google Adwords, mobile solutions, social media enablement, Website analytics, e-mail marketing and productivity and e-commerce tools, among others. It conducts operations in the United States, Brazil, India, and the Netherlands.

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