Head-To-Head Comparison: Forge Global (NYSE:FRGE) & StoneCo (NASDAQ:STNE)

StoneCo (NASDAQ:STNE) and Forge Global (NYSE:FRGE) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, analyst recommendations, valuation, earnings and risk.

Volatility & Risk

StoneCo has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500. Comparatively, Forge Global has a beta of 2.18, indicating that its stock price is 118% more volatile than the S&P 500.

Profitability

This table compares StoneCo and Forge Global’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
StoneCo	22.92%	22.19%	4.10%
Forge Global	-71.87%	-29.06%	-24.63%

Insider and Institutional Ownership

73.2% of StoneCo shares are owned by institutional investors. Comparatively, 40.7% of Forge Global shares are owned by institutional investors. 11.3% of StoneCo shares are owned by insiders. Comparatively, 4.5% of Forge Global shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for StoneCo and Forge Global, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
StoneCo	0	6	4	0	2.40
Forge Global	1	4	0	0	1.80

StoneCo currently has a consensus target price of $14.30, suggesting a potential upside of 51.56%. Forge Global has a consensus target price of $45.00, suggesting a potential upside of 0.00%. Given StoneCo’s stronger consensus rating and higher probable upside, analysts plainly believe StoneCo is more favorable than Forge Global.

Earnings and Valuation

This table compares StoneCo and Forge Global”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
StoneCo	$13.59 billion	0.17	$425.73 million	$2.48	3.80
Forge Global	$92.88 million	6.71	-$66.33 million	($5.20)	-8.65

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

Summary

StoneCo beats Forge Global on 12 of the 14 factors compared between the two stocks.

About StoneCo

StoneCo Ltd. provides financial technology and software solutions to merchants and integrated partners to conduct electronic commerce across in-store, online, and mobile channels in Brazil. It distributes its solutions, principally through proprietary Stone Hubs, which offer hyper-local sales and services; and sells solutions to brick-and-mortar and digital merchants through sales team. The company served small-and-medium-sized businesses; and marketplaces, e-commerce platforms, and integrated software vendors. StoneCo Ltd. was founded in 2000 and is headquartered in George Town, the Cayman Islands.

About Forge Global

Forge Global Holdings, Inc. operates a financial services platform in California. The company's platform solutions include trading solutions, a platform that connects investors with private company stockholders and enables them to facilitate private share transactions; and custody solutions, a non-depository trust company that enables clients to securely custody and manage assets through an online portal. It also provides data solutions, such as information and insight to navigate, analyze, and make investment decisions to market participants in the private market. The company was founded in 2014 and is headquartered in San Francisco, California.