Financial Survey: Twilio (NYSE:TWLO) vs. Affirm (NASDAQ:AFRM)

Twilio (NYSE:TWLO) and Affirm (NASDAQ:AFRM) are both large-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, institutional ownership, risk, dividends, analyst recommendations and profitability.

Earnings and Valuation

This table compares Twilio and Affirm”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Twilio	$5.07 billion	4.24	$33.83 million	$0.19	745.91
Affirm	$3.72 billion	5.65	$52.19 million	$0.81	77.75

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

Insider & Institutional Ownership

84.3% of Twilio shares are owned by institutional investors. Comparatively, 69.3% of Affirm shares are owned by institutional investors. 0.2% of Twilio shares are owned by company insiders. Comparatively, 11.0% of Affirm shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Twilio has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500. Comparatively, Affirm has a beta of 3.63, indicating that its share price is 263% more volatile than the S&P 500.

Profitability

This table compares Twilio and Affirm’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Twilio	0.67%	3.93%	3.19%
Affirm	7.60%	8.83%	2.45%

Analyst Ratings

This is a breakdown of current recommendations for Twilio and Affirm, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Twilio	2	4	19	2	2.78
Affirm	0	8	19	2	2.79

Twilio presently has a consensus target price of $150.87, indicating a potential upside of 6.45%. Affirm has a consensus target price of $83.60, indicating a potential upside of 32.74%. Given Affirm’s stronger consensus rating and higher probable upside, analysts plainly believe Affirm is more favorable than Twilio.

Summary

Affirm beats Twilio on 9 of the 13 factors compared between the two stocks.

About Twilio

Twilio Inc., together with its subsidiaries, provides customer engagement platform solutions in the United States and internationally. It operates through two segments, Twilio Communications and Twilio Segment. The company provides various application programming interfaces and software solutions for communications between customers and end users, including messaging, voice, email, flex, marketing campaigns, and user identity and authentication. It also offers software products to build direct, personalized relationships with their end users, such as segment, a platform that provides tools for first-party data by unifying real-time information collected; and engage, an automation platform for the delivery of omnichannel campaigns. Twilio Inc. was incorporated in 2008 and is headquartered in San Francisco, California.

About Affirm

Affirm Holdings, Inc. operates a platform for digital and mobile-first commerce in the United States, Canada, and internationally. The company's platform includes point-of-sale payment solution for consumers, merchant commerce solutions, and a consumer-focused app. Its commerce platform, agreements with originating banks, and capital markets partners enables consumers to pay for a purchase over time with terms ranging up to 60 months. The company has active merchants covering small businesses, large enterprises, direct-to-consumer brands, brick-and-mortar stores, and companies with an omni-channel presence. Its merchants represent a range of industries, including sporting goods and outdoors, furniture and homewares, travel and ticketing, apparel, accessories, consumer electronics, and jewelry. Affirm Holdings, Inc. was founded in 2012 and is headquartered in San Francisco, California.