Contrasting Microsoft (NASDAQ:MSFT) & ServiceTitan (NASDAQ:TTAN)

ServiceTitan (NASDAQ:TTAN) and Microsoft (NASDAQ:MSFT) are both technology companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, institutional ownership, earnings and risk.

Profitability

This table compares ServiceTitan and Microsoft’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ServiceTitan	-12.12%	-5.65%	-4.93%
Microsoft	40.31%	31.98%	18.70%

Institutional & Insider Ownership

71.1% of Microsoft shares are owned by institutional investors. 39.9% of ServiceTitan shares are owned by company insiders. Comparatively, 0.0% of Microsoft shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

ServiceTitan has a beta of 0.11, indicating that its share price is 89% less volatile than the S&P 500. Comparatively, Microsoft has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500.

Valuation & Earnings

This table compares ServiceTitan and Microsoft”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ServiceTitan	$960.97 million	5.82	-$159.85 million	($1.36)	-43.09
Microsoft	$331.84 billion	11.12	$133.75 billion	$17.96	27.68

Microsoft has higher revenue and earnings than ServiceTitan. ServiceTitan is trading at a lower price-to-earnings ratio than Microsoft, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current recommendations for ServiceTitan and Microsoft, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ServiceTitan	1	2	14	0	2.76
Microsoft	0	5	42	0	2.89

ServiceTitan currently has a consensus price target of $96.38, suggesting a potential upside of 64.46%. Microsoft has a consensus price target of $564.27, suggesting a potential upside of 13.51%. Given ServiceTitan’s higher probable upside, research analysts plainly believe ServiceTitan is more favorable than Microsoft.

Summary

Microsoft beats ServiceTitan on 12 of the 14 factors compared between the two stocks.

About ServiceTitan

ServiceTitan, Inc. engages in the collection of field service activities required to install, maintain, and service the infrastructure and systems of residences and commercial buildings. The company was founded by Ara Mahdessian and Vahe Kuzoyan on June 8, 2008 and is headquartered in Glendale, CA.

About Microsoft

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services. This segment also provides LinkedIn; and dynamics business solutions, including Dynamics 365, a set of intelligent, cloud-based applications across ERP, CRM, power apps, and power automate; and on-premises ERP and CRM applications. The Intelligent Cloud segment offers server products and cloud services, such as azure and other cloud services; SQL and windows server, visual studio, system center, and related client access licenses, as well as nuance and GitHub; and enterprise services including enterprise support services, industry solutions, and nuance professional services. The More Personal Computing segment offers Windows, including windows OEM licensing and other non-volume licensing of the Windows operating system; Windows commercial comprising volume licensing of the Windows operating system, windows cloud services, and other Windows commercial offerings; patent licensing; and windows Internet of Things; and devices, such as surface, HoloLens, and PC accessories. Additionally, this segment provides gaming, which includes Xbox hardware and content, and first- and third-party content; Xbox game pass and other subscriptions, cloud gaming, advertising, third-party disc royalties, and other cloud services; and search and news advertising, which includes Bing, Microsoft News and Edge, and third-party affiliates. The company sells its products through OEMs, distributors, and resellers; and directly through digital marketplaces, online, and retail stores. The company was founded in 1975 and is headquartered in Redmond, Washington.