Contrasting Godaddy (GDDY) & Nextgen Healthcare (NXGN)

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Godaddy (NYSE:GDDY) and Nextgen Healthcare (NASDAQ:NXGN) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, analyst recommendations, valuation and risk.

Volatility & Risk

Godaddy has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Nextgen Healthcare has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Insider and Institutional Ownership

93.6% of Godaddy shares are held by institutional investors. Comparatively, 69.2% of Nextgen Healthcare shares are held by institutional investors. 7.6% of Godaddy shares are held by company insiders. Comparatively, 17.9% of Nextgen Healthcare shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Godaddy and Nextgen Healthcare, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Godaddy 1 4 12 0 2.65
Nextgen Healthcare 0 0 0 0 N/A

Godaddy presently has a consensus target price of $76.50, indicating a potential upside of 8.68%. Given Godaddy’s higher possible upside, analysts clearly believe Godaddy is more favorable than Nextgen Healthcare.

Profitability

This table compares Godaddy and Nextgen Healthcare’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Godaddy 5.83% 8.78% 0.86%
Nextgen Healthcare 0.22% 10.69% 6.81%

Earnings and Valuation

This table compares Godaddy and Nextgen Healthcare’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Godaddy $2.23 billion 5.43 $136.40 million $0.42 167.60
Nextgen Healthcare $531.02 million 2.37 $2.42 million $0.57 34.40

Godaddy has higher revenue and earnings than Nextgen Healthcare. Nextgen Healthcare is trading at a lower price-to-earnings ratio than Godaddy, indicating that it is currently the more affordable of the two stocks.

Summary

Godaddy beats Nextgen Healthcare on 9 of the 13 factors compared between the two stocks.

About Godaddy

GoDaddy Inc. designs and develops cloud-based technology products for small businesses, Web design professionals, and individuals in the United States and internationally. It provides domain name registration product that enables to engage customers at the initial stage of establishing a digital identity; hosting products, such as shared Website hosting, Website hosting on virtual private servers and virtual dedicated servers, managed hosting, and security. The company also offers presence products, including GoCentral, an online tool that enables customers to build Websites and online stores; and a range of marketing tools designed to help businesses acquire and engage customers, as well as search engine optimization that helps customers get their Websites found on search sites. In addition, the company offers business application products, including Microsoft Office 365, email accounts, email marketing, and telephony services. GoDaddy Inc. was incorporated in 2014 and is headquartered in Scottsdale, Arizona.

About Nextgen Healthcare

NextGen Healthcare, Inc. provides software, services, and analytics solutions to medical and dental group practices in the United States. The company's principal products include NextGen Enterprise EHR, which stores and maintains clinical patient information; and a workflow module, prescription management, automatic document and letter generation, patient education, referral tracking, interfaces to billing and lab systems, physician alerts and reminders, and reporting and data analysis tools. Its principal products also comprise NextGen Enterprise PM, a practice management (PM) solution; and NextGen Office, a cloud-based electronic health record and PM solution. In addition, the company offers automation and workflow solutions, including NextGen Mobile Health Solutions, NextGen Electronic Healthcare Transactions, NextGen Pre-Service Clearance, and NextGen Patient Payment solutions. Further, it provides analytics, population health, and patient engagement solutions, such as NextGen Population Health Informed Analytics, NextGen Population Health Patient Care Coordination, NextGen Population Health Performance Management, and NextGen Patient Portal solutions. Additionally, the company offers NextGen Connected Health and NextGen Share interoperability solutions. It also provides professional services, including training, project management, functional and detailed specification preparation, configuration, testing, installation, support, and client services. The company serves multi-specialty and small single specialty practices, including physician hospital and management service organizations, independent physician associations, accountable care organizations, ambulatory care centers, and community health centers through a sales force and reseller channel. The company was formerly known as Quality Systems, Inc. and changed its name to NextGen Healthcare, Inc. in September 2018. NextGen Healthcare, Inc. was founded in 1974 and is headquartered in Irvine, California.

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