Financial Survey: Momo (NASDAQ:MOMO) vs. Mimecast (NASDAQ:MIME)

Momo (NASDAQ:MOMO) and Mimecast (NASDAQ:MIME) are both mid-cap computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, institutional ownership, earnings, analyst recommendations, dividends and profitability.

Institutional & Insider Ownership

58.4% of Momo shares are owned by institutional investors. Comparatively, 71.7% of Mimecast shares are owned by institutional investors. 61.4% of Momo shares are owned by company insiders. Comparatively, 29.0% of Mimecast shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Momo and Mimecast’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Momo 15.96% 23.10% 13.59%
Mimecast -2.06% -2.72% -0.83%

Risk & Volatility

Momo has a beta of 2.18, indicating that its share price is 118% more volatile than the S&P 500. Comparatively, Mimecast has a beta of 1.23, indicating that its share price is 23% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Momo and Mimecast, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Momo 0 0 8 0 3.00
Mimecast 0 2 14 0 2.88

Momo currently has a consensus price target of $44.33, suggesting a potential upside of 33.09%. Mimecast has a consensus price target of $54.20, suggesting a potential upside of 20.42%. Given Momo’s stronger consensus rating and higher possible upside, analysts plainly believe Momo is more favorable than Mimecast.

Valuation & Earnings

This table compares Momo and Mimecast’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Momo $1.95 billion 3.40 $409.54 million $1.96 16.99
Mimecast $340.38 million 8.11 -$7.00 million ($0.07) -643.00

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

Summary

Momo beats Mimecast on 11 of the 14 factors compared between the two stocks.

About Momo

Momo Inc. operates a mobile-based social and entertainment platform in the People's Republic of China. The company operates Momo platform that includes its Momo mobile application and various related features, functionalities, tools, and services to users, customers, and platform partners. It offers Momo mobile application that enables users to establish and expand their social relationships based on locations; interests; and recreational activities, including live talent shows, short videos, social games, and other video- and audio-based interactive experiences. The company also operates Tantan, a social and dating app to help its users to find and establish romantic connections, as well as to meet interesting people primarily for young mobile Internet users. The company was formerly known as Momo Technology Company Limited and changed its name to Momo Inc. in July 2014. Momo Inc. was founded in 2011 and is headquartered in Beijing, the People's Republic of China.

About Mimecast

Mimecast Limited, a email and data security company, provides cloud security and risk management services for corporate information and email. The company offers Mimecast Email Security services, including targeted threat protection services, such as URL Protect that addresses the threat from emails containing malicious links; Attachment Protect that reduces threat from weaponized or malware-laden attachments used in spear-phishing and other attacks; Impersonation Protect that gives protection from malware-less social engineering attacks; and Internal Email Protect, which allows customers to monitor, detect, and remediate security threats that originate from within their internal email systems. Its Mimecast Email Security services also comprise Secure Messaging for sharing sensitive information with external contacts through email; Large File Send that enables employees to create security and compliance risks when they turn to file sharing services; and Data Leak Prevention, which prevents the inadvertent or malicious loss of sensitive corporate data with advanced data leak prevention and content controls. In addition, the company offers Mimecast Mailbox Continuity, which protects email and data against the threat of downtime as a result of system failure, natural disasters, planned maintenance, system upgrades, and migrations; and Mimecast Enterprise Information Archiving that offers cloud archive consolidation of inbound, outbound and internal email, files, and instant messaging in an archive, as well as incorporates legacy data from additional archives into the same searchable store. Further, it provides Service Bundles, a unified service managed from a single administration console; and Mimecast Mobile and Desktop Apps for mobile, PC, and Mac users to get self-service access to security features. The company sells its services through direct sales and channel partners. Mimecast Limited was founded in 2003 and is headquartered in London, the United Kingdom.

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