Financial Contrast: Shopify (NASDAQ:SHOP) and Xperi (NASDAQ:XPER)

Shopify (NASDAQ:SHOP) and Xperi (NASDAQ:XPER) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, institutional ownership, valuation, profitability, analyst recommendations, earnings and dividends.

Profitability

This table compares Shopify and Xperi’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shopify	16.65%	11.72%	9.73%
Xperi	-16.72%	-7.03%	-4.14%

Insider & Institutional Ownership

69.3% of Shopify shares are held by institutional investors. Comparatively, 94.3% of Xperi shares are held by institutional investors. 2.1% of Xperi shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Shopify and Xperi”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shopify	$8.88 billion	24.07	$2.02 billion	$1.35	121.62
Xperi	$453.96 million	0.63	-$136.61 million	$0.16	38.47

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Shopify and Xperi, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shopify	0	23	22	0	2.49
Xperi	0	0	2	0	3.00

Shopify currently has a consensus target price of $166.53, indicating a potential upside of 1.42%. Xperi has a consensus target price of $11.00, indicating a potential upside of 78.72%. Given Xperi’s stronger consensus rating and higher probable upside, analysts plainly believe Xperi is more favorable than Shopify.

Volatility & Risk

Shopify has a beta of 2.82, suggesting that its share price is 182% more volatile than the S&P 500. Comparatively, Xperi has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500.

Summary

Shopify beats Xperi on 10 of the 14 factors compared between the two stocks.

About Shopify

Shopify Inc., a commerce company, provides a commerce platform and services in Canada, the United States, Europe, the Middle East, Africa, the Asia Pacific, Australia, China, and Latin America. The company’s platform enables merchants to displays, manages, markets, and sells its products through various sales channels, including web and mobile storefronts, physical retail locations, pop-up shops, social media storefronts, native mobile apps, buy buttons, and marketplaces; and enables to manage products and inventory, process orders and payments, fulfill and ship orders, new buyers and build customer relationships, source products, leverage analytics and reporting, manage cash, payments and transactions, and access financing. It also sells custom themes and apps, and registration of domain names; and merchant solutions, which include accepting payments, shipping, and securing working capital. The company was formerly known as Jaded Pixel Technologies Inc. and changed its name to Shopify Inc. in November 2011. Shopify Inc. was incorporated in 2004 and is headquartered in Ottawa, Canada.

About Xperi

Xperi Inc. operates as a consumer and entertainment technology company worldwide. It offers Pay-TV solutions, including UX solutions that allows service providers to customize elements of the interactive program guide for their customers and to upgrade the programming features and services; IPTV, a cloud-based solution that supports various services and applications, such as TV programming, broadband OTT video content, digital music, photos, and other media experiences; managed IPTV service; video metadata and services; managed IPTV Service, a customizable, cloud-enabled, and end-to-end streaming video solution that enables operators to quickly launch a branded, fully compliant, full-featured Pay-TV service; metadata libraries comprising television, sports, movies, digital-first, celebrities, books, and video games; personalized content discovery, natural language voice, and insights; and TiVo DVR subscriptions, as well as technical support service. It also provides consumer electronics solutions, such as home and mobile audio solutions, and silicon and software solutions for edge inference; connected car solutions, including HD Radio and DTS AutoStage; and Media Platform that provides Vewd middleware solutions, TiVo OS, TiVo Stream 4K, connected TVs, and connected cars that leverage the TiVo OS, as well as advertising solutions. The company was incorporated in 2019 and is headquartered in San Jose, California.