Blackline (NYSE: BL) and Evolving Systems (NASDAQ:EVOL) are both small-cap technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, dividends, earnings, valuation, profitability and analyst recommendations.

Profitability

This table compares Blackline and Evolving Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Blackline -23.91% -13.96% -9.73%
Evolving Systems 17.69% 15.73% 10.69%

Insider & Institutional Ownership

31.5% of Evolving Systems shares are held by institutional investors. 10.2% of Evolving Systems shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Blackline and Evolving Systems’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Blackline $148.46 million 10.91 -$13.08 million N/A N/A
Evolving Systems $24.32 million 2.45 $7.79 million $0.36 13.19

Evolving Systems has higher revenue, but lower earnings than Blackline.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Blackline and Evolving Systems, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Blackline 0 3 5 0 2.63
Evolving Systems 0 0 0 0 N/A

Blackline currently has a consensus target price of $34.50, indicating a potential upside of 11.76%. Given Blackline’s higher probable upside, equities analysts plainly believe Blackline is more favorable than Evolving Systems.

Summary

Evolving Systems beats Blackline on 6 of the 10 factors compared between the two stocks.

About Blackline

BlackLine, Inc. is a holding company. The Company provides cloud-based software platform that is designed to automate and streamline accounting and finance operations. Its platform supports accounting processes, such as the financial close, account reconciliation, intercompany accounting and controls assurance. Its platform consists of seven core cloud-based products, including Account Reconciliation, Task Management, Transaction Matching, Journal Entry, Variance Analysis, Consolidation Integrity Manager and Daily Reconciliation. The Company’s solutions include Reconciliation Management and Financial Close Management and Insights. It operates through two geographical regions, which include the United States and International. As of December 31, 2016, its software integrated with, and obtained data from, more than 30 various enterprise resource planning (ERP) systems, including NetSuite, Oracle and Workday, as well as many other financial systems and applications.

About Evolving Systems

Evolving Systems, Inc. is a provider of software solutions for service enablement, on-device activation and management of services for connected devices for network operators. The Company operates in two segments: license fees and services revenue, and customer support revenue. Its service activation solution, Tertio is used to activate voice, video and data services for wireless, wireline and cable network operators. Its Subscriber Identity Module (SIM) card activation solution, Dynamic SIM Allocation is used to allocate and assign resources to Mobile Network Operators devices that rely on SIM cards. Its Mobile Data Enablement solution provides a data consumption and policy management solution for wireless carriers and Mobile Virtual Network Operators that monitor the usage and consumption of data services. Its Total Number Management product is an automated database solution that enables operators to manage their telephone numbers, as well as other communication identifiers.

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