Porch Group (NASDAQ:PRCH – Get Free Report) and Smith Micro Software (NASDAQ:SMSI – Get Free Report) are both technology companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.
Profitability
This table compares Porch Group and Smith Micro Software’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Porch Group | -2.67% | -68.47% | -1.67% |
| Smith Micro Software | -92.60% | -44.59% | -31.78% |
Risk & Volatility
Porch Group has a beta of 3.17, meaning that its share price is 217% more volatile than the S&P 500. Comparatively, Smith Micro Software has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Porch Group | 1 | 2 | 5 | 0 | 2.50 |
| Smith Micro Software | 1 | 0 | 1 | 0 | 2.00 |
Porch Group currently has a consensus price target of $18.42, suggesting a potential upside of 2.66%. Smith Micro Software has a consensus price target of $12.50, suggesting a potential upside of 338.60%. Given Smith Micro Software’s higher probable upside, analysts clearly believe Smith Micro Software is more favorable than Porch Group.
Valuation & Earnings
This table compares Porch Group and Smith Micro Software”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Porch Group | $482.41 million | 4.90 | $15.32 million | ($0.12) | -149.50 |
| Smith Micro Software | $17.36 million | 0.92 | -$29.33 million | ($3.52) | -0.81 |
Porch Group has higher revenue and earnings than Smith Micro Software. Porch Group is trading at a lower price-to-earnings ratio than Smith Micro Software, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
48.5% of Porch Group shares are held by institutional investors. Comparatively, 20.8% of Smith Micro Software shares are held by institutional investors. 27.8% of Porch Group shares are held by company insiders. Comparatively, 34.7% of Smith Micro Software shares are held 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.
Summary
Porch Group beats Smith Micro Software on 10 of the 14 factors compared between the two stocks.
About Porch Group
Porch Group, Inc., together with its subsidiaries, operates a vertical software and insurance platform in the United States. The company operates in two segments, Vertical Software and Insurance. The Vertical Software segment provides software and services to inspection, mortgage, and title companies on a subscription and transactional basis, as well as move and post-move services. This segment offers inspection software and services, title insurance software, mortgage software, moving services, mover and homeowner marketing, and measurement software for roofers. The Insurance segment offers consumers with insurance and warranty products to protect their homes. This segment provides property-related insurance and captive reinsurance products; and warranty products under the Porch Warranty, American Home Protect, and Residential Warranty Services brands. The company was founded in 2011 and is headquartered in Seattle, Washington.
About Smith Micro Software
Smith Micro Software, Inc. engages in the development and sale of software to enhance the mobile experience to wireless and cable service providers in the Americas, Europe, the Middle East, and Africa. The company offers SafePath Family, SafePath IoT, SafePath Home, and SafePath Premium product suite, which provides tools to protect digital lifestyles and manage connected devices inside and outside the home; and CommSuite, a messaging platform that helps mobile service provides deliver a next-generation voicemail experience to mobile subscribers, as well as enables multi-language voice-to-text (VTT) transcription messaging. It also offers ViewSpot, a retail display management platform that provides on-screen and interactive demos to wireless carriers and other smartphone retailers; and technical support and customer services. Smith Micro Software, Inc. was founded in 1982 and is headquartered in Pittsburgh, Pennsylvania.
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