Critical Comparison: HubSpot (HUBS) vs. Brightcove (BCOV)

HubSpot (NYSE: HUBS) and Brightcove (NASDAQ:BCOV) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.

Volatility and Risk

HubSpot has a beta of 2.24, suggesting that its stock price is 124% more volatile than the S&P 500. Comparatively, Brightcove has a beta of 1.86, suggesting that its stock price is 86% more volatile than the S&P 500.

Profitability

This table compares HubSpot and Brightcove’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HubSpot -12.16% -21.93% -7.61%
Brightcove -14.58% -25.11% -13.88%

Valuation and Earnings

This table compares HubSpot and Brightcove’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
HubSpot $270.97 million 14.23 -$45.56 million ($1.16) -88.92
Brightcove $150.27 million 1.58 -$9.98 million ($0.66) -10.38

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

Insider and Institutional Ownership

94.6% of HubSpot shares are owned by institutional investors. Comparatively, 62.8% of Brightcove shares are owned by institutional investors. 12.1% of HubSpot shares are owned by insiders. Comparatively, 4.4% of Brightcove 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.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for HubSpot and Brightcove, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HubSpot 0 3 14 0 2.82
Brightcove 0 1 2 0 2.67

HubSpot presently has a consensus price target of $92.67, suggesting a potential downside of 10.16%. Brightcove has a consensus price target of $8.42, suggesting a potential upside of 22.87%. Given Brightcove’s higher probable upside, analysts plainly believe Brightcove is more favorable than HubSpot.

Summary

HubSpot beats Brightcove on 10 of the 14 factors compared between the two stocks.

HubSpot Company Profile

HubSpot, Inc. (HubSpot) provides a cloud-based marketing and sales software platform. The Company’s software platform features integrated applications to help businesses attract visitors to their Websites, convert visitors into leads, close leads into customers and delight customers so that they become promoters of those businesses. These integrated applications include social media, search engine optimization, blogging, Website content management, marketing automation, e-mail, sales productivity, customer relationship management (CRM), analytics and reporting. The Company’s products include HubSpot Marketing, HubSpot CRM and HubSpot Sales. The Company offers Professional Services and support. It offers professional services to educate and train customers on how to leverage its software platform and inbound marketing methodology to transform how their business attracts, engages and delights customers.

Brightcove Company Profile

Brightcove Inc. is a global provider of cloud-based services for video. The Company’s products and services include Brightcove Video Cloud (Video Cloud), Brightcove Zencoder (Zencoder), Brightcove Once (Once), Brightcove Perform (Perform), Brightcove Video Marketing Suite (Video Marketing Suite), Brightcove Lift (Lift), Brightcove OTT Flow (OTT Flow) and Brightcove Enterprise Video Suite (Enterprise Video Suite), among others. Video Cloud is an online video platform. Video Cloud enables its customers to publish and distribute video to Internet-connected devices. Zencoder is a cloud-based video encoding service. Once is a cloud-based advertisement insertion and video stitching service. Perform is a cloud-based service for creating and managing video player experiences. Video Marketing Suite is a suite of video technologies designed to address the needs of marketers to drive awareness, engagement and conversion.

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