VASCO Data Security International (NASDAQ: VDSI) and LivePerson (NASDAQ:LPSN) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, earnings, dividends and valuation.

Insider and Institutional Ownership

51.6% of VASCO Data Security International shares are owned by institutional investors. Comparatively, 74.9% of LivePerson shares are owned by institutional investors. 25.9% of VASCO Data Security International shares are owned by company insiders. Comparatively, 11.4% of LivePerson shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

VASCO Data Security International has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500. Comparatively, LivePerson has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for VASCO Data Security International and LivePerson, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
VASCO Data Security International 0 1 2 0 2.67
LivePerson 0 2 3 0 2.60

VASCO Data Security International currently has a consensus price target of $17.00, suggesting a potential upside of 38.21%. LivePerson has a consensus price target of $11.57, suggesting a potential downside of 11.68%. Given VASCO Data Security International’s stronger consensus rating and higher possible upside, analysts plainly believe VASCO Data Security International is more favorable than LivePerson.

Valuation and Earnings

This table compares VASCO Data Security International and LivePerson’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
VASCO Data Security International $178.90 million 2.74 $7.35 million $0.15 82.00
LivePerson $215.63 million 3.58 $8.16 million ($0.50) -26.20

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

Profitability

This table compares VASCO Data Security International and LivePerson’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
VASCO Data Security International 3.45% 6.06% 4.81%
LivePerson -13.29% -8.71% -5.58%

Summary

VASCO Data Security International beats LivePerson on 8 of the 13 factors compared between the two stocks.

VASCO Data Security International Company Profile

VASCO Data Security International, Inc. designs, develops and markets digital solutions for identity, security and business productivity that protect and facilitate transactions online, via mobile devices, and in-person. The Company provides anti-fraud and digital transaction management solutions to financial institutions and other businesses. Its solutions secure access to data, assets, and applications for global enterprises; provide tools for application developers to easily integrate security functions into their Web-based and mobile applications, and facilitate digital transactions involving the signing, sending, and managing of documents. It also provides tools for application developers to integrate security functions into their Web-based and mobile applications. It facilitates digital transactions involving the signing, sending and managing of documents. Its security solutions include both open standards-based and solutions.

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.

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