Head-To-Head Analysis: Upwork (NASDAQ:UPWK) versus RCM Technologies (NASDAQ:RCMT)

Upwork (NASDAQ:UPWK) and RCM Technologies (NASDAQ:RCMT) are both small-cap industrials companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Insider and Institutional Ownership

77.7% of Upwork shares are owned by institutional investors. Comparatively, 43.2% of RCM Technologies shares are owned by institutional investors. 4.9% of Upwork shares are owned by insiders. Comparatively, 28.0% of RCM Technologies 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.

Profitability

This table compares Upwork and RCM Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Upwork	13.53%	16.92%	8.79%
RCM Technologies	5.13%	37.92%	12.83%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Upwork and RCM Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Upwork	1	9	3	0	2.15
RCM Technologies	0	2	2	0	2.50

Upwork currently has a consensus target price of $13.55, suggesting a potential upside of 38.34%. RCM Technologies has a consensus target price of $45.00, suggesting a potential upside of 28.26%. Given Upwork’s higher possible upside, equities analysts plainly believe Upwork is more favorable than RCM Technologies.

Volatility and Risk

Upwork has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, RCM Technologies has a beta of 0.48, suggesting that its share price is 52% less volatile than the S&P 500.

Valuation and Earnings

This table compares Upwork and RCM Technologies”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Upwork	$787.78 million	1.56	$115.43 million	$0.81	12.09
RCM Technologies	$333.62 million	0.75	$16.33 million	$2.30	15.25

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

Summary

Upwork beats RCM Technologies on 8 of the 14 factors compared between the two stocks.

About Upwork

Upwork operates an online marketplace that connects businesses with independent professionals and agencies for contract and project-based work. The platform supports hiring across areas such as software development, design, marketing, writing, customer service and consulting. Its services include the Talent Marketplace, where clients can find and hire professionals, and Project Catalog, which offers predefined services with set scopes. Upwork also provides solutions for larger organizations seeking to source and manage freelance talent.

About RCM Technologies

RCM Technologies, Inc. (NASDAQ: RCMT) is a provider of business and technology solutions for commercial and government organizations. The company delivers consulting, staffing, project management and implementation services designed to support clients’ operational, technical and workforce needs. RCM Technologies operates through service areas that include engineering, life sciences and information technology. Its engineering business supports infrastructure, utilities, transportation, aerospace and defense, and other industrial and public-sector projects.