Ooma (OOMA) & West Corporation (WSTC) Financial Survey
Ooma (NYSE: OOMA) and West Corporation (NASDAQ:WSTC) are both small-cap technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, valuation, risk, earnings, profitability, institutional ownership and analyst recommendations.
Risk and Volatility
Ooma has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, West Corporation has a beta of 1.59, meaning that its share price is 59% more volatile than the S&P 500.
Institutional and Insider Ownership
74.0% of Ooma shares are owned by institutional investors. Comparatively, 67.4% of West Corporation shares are owned by institutional investors. 11.4% of Ooma shares are owned by company insiders. Comparatively, 4.6% of West Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Ooma and West Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ooma||$110.34 million||1.61||-$10.66 million||($0.71)||-13.66|
|West Corporation||$2.29 billion||0.85||$636.33 million||$2.51||9.31|
West Corporation has higher revenue and earnings than Ooma. Ooma is trading at a lower price-to-earnings ratio than West Corporation, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings for Ooma and West Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ooma presently has a consensus target price of $12.00, suggesting a potential upside of 23.71%. West Corporation has a consensus target price of $24.50, suggesting a potential upside of 4.84%. Given Ooma’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Ooma is more favorable than West Corporation.
This table compares Ooma and West Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
West Corporation pays an annual dividend of $0.45 per share and has a dividend yield of 1.9%. Ooma does not pay a dividend. West Corporation pays out 17.9% of its earnings in the form of a dividend.
Ooma beats West Corporation on 8 of the 15 factors compared between the two stocks.
Ooma Company Profile
Ooma, Inc. is a United States-based company, which offers Ooma, a communications platform for small businesses and consumers. Ooma serves as a communications hub, which offers cloud-based telephony, Internet security, home monitoring and other connected services. Ooma combines PureVoice high definition (HD) call quality features with mobile applications anytime, anywhere calling. Ooma is a full router capable of prioritizing voice data and directing traffic to ensure reliable phone service. Its enterprise-grade phone service built for small business includes features, such as calling features, including unlimited calling in United States and Canada, 911 service and toll-free numbers available; office features, including virtual receptionist, extension dialing and voicemail; mobility features, including call forwarding, voicemail forwarding and multi-ring, and one-touch Internet protocol (IP) phone features, including three way conference, transfer calls and call on hold.
West Corporation Company Profile
West Corporation is a provider of communication and network infrastructure services. The Company helps its clients communicate, collaborate and connect with their audiences through a portfolio of solutions that include unified communications services, safety services, and interactive services, such as automated notifications, specialized agent services and telecom services. The Company’s segments include Unified Communications Services, which includes collaboration services, Unified Communications as a Service (UCaaS) and telecom services; Safety Services, which includes carrier services, government solutions and advanced services; Interactive Services, including outbound (proactive notifications-voice, text/short messaging service (SMS) and chat), inbound speech solutions (interactive voice response or IVR), Web, mobile and professional services, and Specialized Agent Services, which includes healthcare advocacy services, cost management services and revenue generation.
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