8X8 (NASDAQ:EGHT) versus HubSpot (NYSE:HUBS) Critical Analysis

8X8 (NASDAQ:EGHT) and HubSpot (NYSE:HUBS) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Risk & Volatility

8X8 has a beta of 1.78, indicating that its share price is 78% more volatile than the S&P 500. Comparatively, HubSpot has a beta of 1.46, indicating that its share price is 46% more volatile than the S&P 500.

Profitability

This table compares 8X8 and HubSpot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
8X8	-0.82%	14.95%	2.71%
HubSpot	-0.12%	1.21%	0.64%

Analyst Ratings

This is a breakdown of recent ratings and target prices for 8X8 and HubSpot, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
8X8	4	1	3	0	1.88
HubSpot	1	3	28	2	2.91

8X8 currently has a consensus target price of $2.49, indicating a potential upside of 31.52%. HubSpot has a consensus target price of $613.45, indicating a potential upside of 60.24%. Given HubSpot’s stronger consensus rating and higher possible upside, analysts plainly believe HubSpot is more favorable than 8X8.

Institutional & Insider Ownership

94.0% of 8X8 shares are held by institutional investors. Comparatively, 90.4% of HubSpot shares are held by institutional investors. 2.0% of 8X8 shares are held by company insiders. Comparatively, 4.0% of HubSpot shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares 8X8 and HubSpot”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
8X8	$715.07 million	0.37	-$27.21 million	($0.04)	-47.25
HubSpot	$2.63 billion	7.63	$4.63 million	($0.08)	-4,785.49

HubSpot has higher revenue and earnings than 8X8. HubSpot is trading at a lower price-to-earnings ratio than 8X8, indicating that it is currently the more affordable of the two stocks.

Summary

HubSpot beats 8X8 on 9 of the 15 factors compared between the two stocks.

About 8X8

8×8, Inc. engages in the provision of enterprise communication solutions. It offers solutions to the business services, education, financial services, government, healthcare, and manufacturing industries. The company was founded in February 1987 and is headquartered in Campbell, CA.

About HubSpot

HubSpot, Inc., together with its subsidiaries, provides a cloud-based customer relationship management (CRM) platform for businesses in the Americas, Europe, and the Asia Pacific. The company's CRM platform includes Marketing Hub, a toolset for marketing automation and email, social media, SEO, and reporting and analytics; Sales Hub offers email templates and tracking, conversations and live chat, meeting and call scheduling, lead and website visit alerts, lead scoring, sales automation, pipeline management, quoting, forecasting, and reporting; Service Hub, a service software designed to help businesses manage, respond, and connect with customers; and Content Management Systems Hub enables businesses to create new and edit existing web content. It offers Operations Hub, which is designed to unify customer data, automate business processes, data cleanup, and provide customer insights and connections; and Commerce Hub, a B2B commerce suite. In addition, the company provides professional services to educate and train customers on how to utilize its CRM platform; and customer success, as well as phone and/or email and chat-based support services. It serves mid-market business-to-business companies. The company was incorporated in 2005 and is headquartered in Cambridge, Massachusetts.