Head-To-Head Review: AppFolio (APPF) & Sapiens International Corporation N.V. (SPNS)

AppFolio (NASDAQ: APPF) and Sapiens International Corporation N.V. (NASDAQ:SPNS) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, valuation, institutional ownership, profitability, dividends and analyst recommendations.

Insider & Institutional Ownership

20.9% of AppFolio shares are owned by institutional investors. Comparatively, 11.7% of Sapiens International Corporation N.V. shares are owned by institutional investors. 44.8% of AppFolio shares are owned by insiders. Comparatively, 16.0% of Sapiens International Corporation N.V. shares are owned 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.

Analyst Ratings

This is a breakdown of recent recommendations for AppFolio and Sapiens International Corporation N.V., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AppFolio 0 3 2 0 2.40
Sapiens International Corporation N.V. 0 0 5 0 3.00

AppFolio currently has a consensus target price of $36.50, indicating a potential downside of 28.29%. Sapiens International Corporation N.V. has a consensus target price of $15.00, indicating a potential upside of 9.49%. Given Sapiens International Corporation N.V.’s stronger consensus rating and higher probable upside, analysts plainly believe Sapiens International Corporation N.V. is more favorable than AppFolio.

Profitability

This table compares AppFolio and Sapiens International Corporation N.V.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AppFolio 0.84% 1.46% 1.12%
Sapiens International Corporation N.V. 1.39% 6.77% 4.41%

Valuation & Earnings

This table compares AppFolio and Sapiens International Corporation N.V.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AppFolio $124.18 million 13.90 $4.64 million $0.03 1,697.23
Sapiens International Corporation N.V. $239.18 million 2.81 $14.79 million $0.07 195.74

Sapiens International Corporation N.V. has higher revenue and earnings than AppFolio. Sapiens International Corporation N.V. is trading at a lower price-to-earnings ratio than AppFolio, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

AppFolio has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500. Comparatively, Sapiens International Corporation N.V. has a beta of 1.23, indicating that its stock price is 23% more volatile than the S&P 500.

Summary

Sapiens International Corporation N.V. beats AppFolio on 10 of the 14 factors compared between the two stocks.

AppFolio Company Profile

AppFolio, Inc. is a provider of industry-specific, cloud-based software solutions for small and medium-sized businesses (SMBs) in the property management and legal industries. The Company’s mobile-optimized software solutions enable its customers to work at any time and from anywhere across multiple devices. Its property management software provides small and medium-sized property managers with an end-to-end solution to their business needs. The Company’s legal software provides solo practitioners and small law firms with a streamlined practice and case management solution, allowing them to manage their practices and case load. It also offers Value+ services, such as its professionally designed Websites and electronic payment services. The Company’s property manager customers include third-party managers and owner-operators, managing single- and multi-family residences, commercial property and student housing, as well as mixed real estate portfolios.

Sapiens International Corporation N.V. Company Profile

Sapiens International Corporation N.V. (Sapiens) is a provider of software solutions for the insurance industry, with a focus on the financial services sector. The Company operates in provider of software solutions segment. Its software solutions portfolio consists of Life, Pension, Annuity and Retirement Solutions, including software solutions for the management of a range of products for life, pension, annuity and retirement; Property and Casualty/General Insurance Solutions, including a software suite of solutions, supporting a range of business lines, including personal, commercial and specialty lines, as well as a solution for the management of reinsurance contracts; Sapiens DECISION, which is a business decision management solution, and Technology-Based Solutions, such as Sapiens eMerge. Its services include project delivery and implementation, business and technical consulting related to its products, project and program management, training and user acceptance testing.

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