Critical Review: Top Image Systems (TISA) & SciQuest (SQI)

Top Image Systems (NASDAQ: TISA) and SciQuest (NASDAQ:SQI) are both small-cap technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitability, dividends, institutional ownership, valuation, analyst recommendations and risk.

Insider & Institutional Ownership

5.4% of Top Image Systems shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Top Image Systems and SciQuest, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Top Image Systems 0 1 2 0 2.67
SciQuest 0 0 0 0 N/A

Top Image Systems currently has a consensus target price of $2.50, suggesting a potential upside of 127.27%. Given Top Image Systems’ higher probable upside, analysts clearly believe Top Image Systems is more favorable than SciQuest.

Earnings & Valuation

This table compares Top Image Systems and SciQuest’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Top Image Systems $31.64 million 0.62 -$6.61 million ($0.51) -2.16
SciQuest N/A N/A N/A $0.11 161.36

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

Profitability

This table compares Top Image Systems and SciQuest’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Top Image Systems -30.77% -50.20% -24.46%
SciQuest 3.93% 2.23% 1.59%

Volatility & Risk

Top Image Systems has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500. Comparatively, SciQuest has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500.

Summary

SciQuest beats Top Image Systems on 6 of the 10 factors compared between the two stocks.

About Top Image Systems

Top Image Systems Ltd. (TIS) is a developer and marketer of intelligent content capture and workflow automation solutions for managing and validating incoming content in any format from any source. The Company’s solutions deliver digital content to the people and applications that drive an enterprise by using advanced network, mobile and cloud technologies. Its products integrate information regardless of the source and format of the data, whether structured, as in the case of application forms or surveys, or semi-structured, such as invoices, purchase orders, checks, freight and shipping bills, and others or unstructured. Its software minimizes the need for manual data entry by automatically capturing, reading, understanding, identifying, processing, classifying and routing the information contained in documents. Its mobiFLOW software development kit (SDK) is a multi-purpose mobile capture and processing platform that enables capture of any document of any size using a mobile device.

About SciQuest

SciQuest, Inc. is a United States-based public provider of spend management solutions. The Company’s offers a range of solutions, such as Spend Director, Spend Radar, Sourcing Director, Advanced Sourcing Optimizer, Total Contract Manager, Total Supplier Manager, Enterprise Reagent Manager, Accounts Payable Director, Supplier Network and Portfolio Savings Manager. Its Spend Director is an e-procurement software, which allows users’ to integrate and automate processes, suppliers, compliance and workflows. Its Portfolio Savings Manager is a cloud-based savings management software that integrates project forecasting, initiative approval workflows and real-time savings. Its chemical inventory management software, Enterprise Reagent Manager (ERM), allows scientific staff in the organization to find, source and track commercial and proprietary chemicals, reagents and lab supplies. Its Total Contract Manager is a Contract Lifecycle Management solution that offers real-time updates.

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