Comparing 8X8 (NASDAQ:EGHT) and Magnite (NASDAQ:MGNI)

8X8 (NASDAQ:EGHT) and Magnite (NASDAQ:MGNI) are both small-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, profitability, earnings, institutional ownership and valuation.

Volatility & Risk

8X8 has a beta of 1.81, meaning that its stock price is 81% more volatile than the S&P 500. Comparatively, Magnite has a beta of 2.39, meaning that its stock price is 139% more volatile than the S&P 500.

Insider and Institutional Ownership

94.0% of 8X8 shares are owned by institutional investors. Comparatively, 73.4% of Magnite shares are owned by institutional investors. 2.0% of 8X8 shares are owned by company insiders. Comparatively, 3.8% of Magnite shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares 8X8 and Magnite’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
8X8	-0.53%	20.12%	3.92%
Magnite	20.25%	8.44%	2.34%

Analyst Recommendations

This is a summary of recent ratings and target prices for 8X8 and Magnite, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
8X8	1	1	2	0	2.25
Magnite	0	2	9	0	2.82

8X8 currently has a consensus price target of $2.55, indicating a potential upside of 32.81%. Magnite has a consensus price target of $24.10, indicating a potential upside of 88.13%. Given Magnite’s stronger consensus rating and higher possible upside, analysts clearly believe Magnite is more favorable than 8X8.

Earnings & Valuation

This table compares 8X8 and Magnite”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
8X8	$715.07 million	0.37	-$27.21 million	($0.02)	-96.00
Magnite	$713.95 million	2.57	$144.61 million	$0.94	13.63

Magnite has lower revenue, but higher earnings than 8X8. 8X8 is trading at a lower price-to-earnings ratio than Magnite, indicating that it is currently the more affordable of the two stocks.

Summary

Magnite beats 8X8 on 10 of the 14 factors compared between the two stocks.

About 8X8

8×8, Inc. engages in the provision of enterprise communication solutions. It offers solutions to the business services, education, financial services, government, healthcare, and manufacturing industries. The company was founded in February 1987 and is headquartered in Campbell, CA.

About Magnite

Magnite, Inc., together with its subsidiaries, operates an independent omni-channel sell-side advertising platform in the United States and internationally. The company’s platform offers applications and services for sellers of digital advertising inventory or publishers that own and operate CTV channels, applications, websites, and other digital media properties to manage and monetize their inventory; and applications and services for buyers, including advertisers, agencies, agency trading desks, and demand side platforms to buy digital advertising inventory, as well as an independent marketplace that connects buyers and sellers. It markets its solutions through sales teams that operate from various locations. The company was formerly known as The Rubicon Project, Inc. and changed name to Magnite, Inc. in July 2020. Magnite, Inc. was incorporated in 2007 and is headquartered in New York, New York.