Financial Contrast: Autodesk (NASDAQ:ADSK) versus Zoom Communications (NASDAQ:ZM)

Zoom Communications (NASDAQ:ZM) and Autodesk (NASDAQ:ADSK) are both large-cap technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, valuation, earnings, analyst recommendations, risk and institutional ownership.

Volatility & Risk

Zoom Communications has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, Autodesk has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Zoom Communications and Autodesk, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zoom Communications	0	11	16	0	2.59
Autodesk	0	6	25	1	2.84

Zoom Communications presently has a consensus target price of $114.48, indicating a potential upside of 24.46%. Autodesk has a consensus target price of $316.84, indicating a potential upside of 22.85%. Given Zoom Communications’ higher possible upside, analysts plainly believe Zoom Communications is more favorable than Autodesk.

Earnings & Valuation

This table compares Zoom Communications and Autodesk”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zoom Communications	$4.87 billion	5.51	$1.90 billion	$10.80	8.52
Autodesk	$7.21 billion	7.48	$1.12 billion	$7.73	33.36

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

Profitability

This table compares Zoom Communications and Autodesk’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zoom Communications	65.19%	10.86%	8.93%
Autodesk	21.08%	58.63%	15.10%

Institutional & Insider Ownership

66.5% of Zoom Communications shares are owned by institutional investors. Comparatively, 90.2% of Autodesk shares are owned by institutional investors. 8.8% of Zoom Communications shares are owned by insiders. Comparatively, 0.1% of Autodesk shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Autodesk beats Zoom Communications on 10 of the 15 factors compared between the two stocks.

About Zoom Communications

Zoom Video Communications, Inc. provides unified communications platform in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. The company offers Zoom Meetings that offers HD video, voice, chat, and content sharing through mobile devices, desktops, laptops, telephones, and conference room systems; Zoom Phone, an enterprise cloud phone system; and Zoom Chat enables users to share messages, images, audio files, and content in desktop, laptop, tablet, and mobile devices. It also provides Zoom Rooms, a software-based conference room system; Zoom Conference Room Connector, a gateway for SIP/H.323 endpoints to join Zoom meetings; Zoom Events, which enables users to manage and host internal and external virtual events; OnZoom, a prosumer-focused virtual event platform and marketplace for Zoom users to create, host, and monetize online events; and Zoom Webinars to provide video presentations to large audiences from many devices. In addition, the company offers Zoom Developer Platform that enables developers, platform integrators, service providers, and customers to build apps and integrations using Zoom’s video-based communications solutions, as well as integrate Zoom’s technology into their products and services; Zoom App Marketplace, which helps developers to publish their apps, as well as third-party integrations of Zoom; and Zoom Contact Center, an omnichannel contact center solution. It serves individuals; and education, entertainment/media, enterprise infrastructure, finance, government, healthcare, manufacturing, non-profit/not for profit and social impact, retail/consumer products, and software/Internet industries. The company was formerly known as Zoom Communications, Inc. and changed its name to Zoom Video Communications, Inc. in May 2012. The company was incorporated in 2011 and is headquartered in San Jose, California.

About Autodesk

Autodesk, Inc. provides 3D design, engineering, and entertainment technology solutions worldwide. The company offers AutoCAD Civil 3D, a surveying, design, analysis, and documentation solution for civil engineering, including land development, transportation, and environmental projects; BuildingConnected, a SaaS preconstruction solution; AutoCAD, a software for professional design, drafting, detailing, and visualization; AutoCAD LT, a drafting and detailing software; computer-aided manufacturing (CAM) software for computer numeric control machining, inspection, and modelling for manufacturing; Fusion 360, a 3D CAD, CAM, and computer-aided engineering tool; and Industry Collections tools for professionals in architecture, engineering and construction, product design and manufacturing, and media and entertainment collection industries. It also provides Inventor tools for 3D mechanical design, simulation, analysis, tooling, visualization, and documentation; Vault, a data management software to manage data in one central location, accelerate design processes, and streamline internal/external collaboration; Maya and 3ds Max software products that offer 3D modeling, animation, effects, rendering, and compositing solutions; and ShotGrid, a cloud-based software for review and production tracking in the media and entertainment industry. It sells its products and services to customers directly, as well as through a network of resellers and distributors. Autodesk, Inc. was incorporated in 1982 and is headquartered in San Francisco, California.