Zendesk (NYSE:ZEN) and Smartsheet (NYSE:SMAR) are both mid-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, analyst recommendations, earnings, dividends and profitability.

Analyst Ratings

This is a summary of current recommendations and price targets for Zendesk and Smartsheet, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zendesk 0 3 14 0 2.82
Smartsheet 0 0 7 0 3.00

Zendesk presently has a consensus target price of $67.13, suggesting a potential upside of 23.39%. Smartsheet has a consensus target price of $35.83, suggesting a potential upside of 40.14%. Given Smartsheet’s stronger consensus rating and higher probable upside, analysts plainly believe Smartsheet is more favorable than Zendesk.

Valuation & Earnings

This table compares Zendesk and Smartsheet’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Zendesk $430.49 million 13.53 -$110.63 million ($1.03) -52.82
Smartsheet $111.25 million 23.62 -$49.10 million N/A N/A

Smartsheet has lower revenue, but higher earnings than Zendesk.

Profitability

This table compares Zendesk and Smartsheet’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zendesk -22.64% -26.15% -9.93%
Smartsheet N/A N/A N/A

Insider & Institutional Ownership

92.7% of Zendesk shares are owned by institutional investors. Comparatively, 41.8% of Smartsheet shares are owned by institutional investors. 4.7% of Zendesk shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Smartsheet beats Zendesk on 7 of the 11 factors compared between the two stocks.

Zendesk Company Profile

Zendesk, Inc., a software development company, provides SaaS products for organizations. Its flagship product is Zendesk Support, a system for tracking, prioritizing, and solving customer support tickets across various channels. The company also offers Zendesk Chat, a live chat software to connect with customers on Websites, in applications, and on mobile devices; Zendesk Talk, a cloud-based call center software; Zendesk Guide, a knowledge base that for customer self-service and support agent productivity; Zendesk Message, a customer messaging software; and Zendesk Explore that makes customer data accessible across an organization. In addition, it operates a developer platform that allows organizations to extend the functionality of its family of products, integrate into internal and third-party systems, and customize the experience for their employees and customers. It has operations in the United States, Europe, the Middle East, Africa, and internationally. Zendesk, Inc. was founded in 2007 and is headquartered in San Francisco, California.

Smartsheet Company Profile

Smartsheet Inc. provides cloud-based platform for execution of work. It enables teams and organizations to plan, capture, manage, automate, and report on work. The company offers Smartdashboards that provides the status of work to align individuals, managers, and executives; Smartportals to easily locate and access from any device the resources available for a project without IT assistance; Smartcards to organize, share, and act on workflows; and Smartgrids to keep teams on task by easily tracking multiple moving parts. It also provides Smartprojects; Smartcalendars, which align teams and organizations by connecting deadlines to workflows; Smartforms enables business users to collect information in a structured and consistent format; Smartautomation that automates repetitive processes; and Smartintegrations enable organizations and teams to connect, sync, and extend enterprise applications. In addition, it offers Connectors; and Control Center that enables organizations to achieve consistent work execution. As of January 31, 2018, it served approximately 92,000 customers. The company was founded in 2005 and is headquartered in Bellevue, Washington.

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