Smith Micro Software (NASDAQ:SMSI – Get Free Report) and Porch Group (NASDAQ:PRCH – Get Free Report) are both technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitability and dividends.
Profitability
This table compares Smith Micro Software and Porch Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Smith Micro Software | -92.60% | -44.59% | -31.78% |
| Porch Group | -2.67% | -68.47% | -1.67% |
Insider and Institutional Ownership
20.8% of Smith Micro Software shares are held by institutional investors. Comparatively, 48.5% of Porch Group shares are held by institutional investors. 34.7% of Smith Micro Software shares are held by insiders. Comparatively, 27.8% of Porch Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Smith Micro Software | $17.36 million | 0.90 | -$29.33 million | ($3.52) | -0.80 |
| Porch Group | $482.41 million | 4.48 | $15.32 million | ($0.12) | -136.50 |
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.
Analyst Recommendations
This is a summary of current recommendations and price targets for Smith Micro Software and Porch Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Smith Micro Software | 1 | 0 | 1 | 0 | 2.00 |
| Porch Group | 1 | 2 | 5 | 0 | 2.50 |
Smith Micro Software presently has a consensus target price of $12.50, suggesting a potential upside of 346.43%. Porch Group has a consensus target price of $18.42, suggesting a potential upside of 12.43%. Given Smith Micro Software’s higher possible upside, analysts clearly believe Smith Micro Software is more favorable than Porch Group.
Volatility & Risk
Smith Micro Software has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, Porch Group has a beta of 3.17, suggesting that its stock price is 217% more volatile than the S&P 500.
Summary
Porch Group beats Smith Micro Software on 10 of the 14 factors compared between the two stocks.
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.
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.
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