Contrasting MongoDB (NASDAQ:MDB) and Paycom Software (NYSE:PAYC)

MongoDB (NASDAQ:MDB) and Paycom Software (NYSE:PAYC) are both large-cap technology companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitability, earnings, risk, institutional ownership and valuation.

Institutional and Insider Ownership

89.3% of MongoDB shares are held by institutional investors. Comparatively, 87.8% of Paycom Software shares are held by institutional investors. 2.6% of MongoDB shares are held by company insiders. Comparatively, 13.2% of Paycom Software shares are held 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.

Analyst Ratings

This is a summary of recent ratings and target prices for MongoDB and Paycom Software, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MongoDB	0	7	29	2	2.87
Paycom Software	1	12	4	0	2.18

MongoDB currently has a consensus price target of $461.91, suggesting a potential upside of 47.65%. Paycom Software has a consensus price target of $255.36, suggesting a potential upside of 8.11%. Given MongoDB’s stronger consensus rating and higher possible upside, equities research analysts clearly believe MongoDB is more favorable than Paycom Software.

Valuation and Earnings

This table compares MongoDB and Paycom Software”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MongoDB	$2.46 billion	10.23	-$71.15 million	$0.71	440.61
Paycom Software	$2.19 billion	4.86	$453.40 million	$10.44	22.63

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

Risk and Volatility

MongoDB has a beta of 1.74, suggesting that its stock price is 74% more volatile than the S&P 500. Comparatively, Paycom Software has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500.

Profitability

This table compares MongoDB and Paycom Software’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MongoDB	2.12%	1.06%	0.84%
Paycom Software	23.28%	52.12%	8.40%

Summary

MongoDB beats Paycom Software on 9 of the 15 factors compared between the two stocks.

About MongoDB

MongoDB, Inc., together with its subsidiaries, provides general purpose database platform worldwide. The company provides MongoDB Atlas, a hosted multi-cloud database-as-a-service solution; MongoDB Enterprise Advanced, a commercial database server for enterprise customers to run in the cloud, on-premises, or in a hybrid environment; and Community Server, a free-to-download version of its database, which includes the functionality that developers need to get started with MongoDB. It offers professional services comprising consulting and training. The company was formerly known as 10gen, Inc. and changed its name to MongoDB, Inc. in August 2013. MongoDB, Inc. was incorporated in 2007 and is headquartered in New York, New York.

About Paycom Software

Paycom Software, Inc. provides cloud-based human capital management (HCM) solution delivered as software-as-a-service for small to mid-sized companies in the United States. It offers functionality and data analytics that businesses need to manage the employment life cycle from recruitment to retirement. The company's HCM solution provides a suite of applications in the areas of talent acquisition, including applicant tracking, candidate tracker, background checks, on-boarding, e-verify, and tax credit services; and time and labor management, such as time and attendance, scheduling, time-off requests, labor allocation, labor management reports/push reporting, geofencing/geotracking, and Microfence, a proprietary Bluetooth. Its HCM solution also offers payroll applications comprising better employee transaction interface, payroll and tax management, payroll card, Everyday, Paycom pay, Client Action Center, expense management, mileage tracker/fixed and variable rates, garnishment administration, and GL concierge applications; and talent management applications that include employee self-service, compensation budgeting, performance management, position management, and Paycom learning, as well as my analytics. In addition, its HCM solution provides manager on-the-go that gives supervisors and managers the ability to perform a variety of tasks, such as approving time-off requests and expense reimbursements; direct data exchange; ask here, a tool for direct line of communication to ask work-related questions; document and checklist; government and compliance; benefits administration/benefits to carrier; benefit enrollment service; COBRA administration; personnel action and performance discussion forms; surveys; 401(k) reporting; report center; and affordable care act applications, as well as Clue, which securely collects, tracks, and manages the vaccination and testing data of the workforce. Paycom Software, Inc. was founded in 1998 and is based in Oklahoma City, Oklahoma.