Critical Analysis: SolarWinds (SWI) & Talend (TLND)

SolarWinds (NYSE: SWI) and Talend (NASDAQ:TLND) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, profitability, earnings and dividends.

Analyst Ratings

This is a summary of current recommendations for SolarWinds and Talend, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SolarWinds 0 0 0 0 N/A
Talend 1 1 5 0 2.57

Talend has a consensus target price of $48.67, suggesting a potential upside of 14.48%. Given Talend’s higher probable upside, analysts plainly believe Talend is more favorable than SolarWinds.

Risk and Volatility

SolarWinds has a beta of 1.3, indicating that its share price is 30% more volatile than the S&P 500. Comparatively, Talend has a beta of 2.04, indicating that its share price is 104% more volatile than the S&P 500.

Profitability

This table compares SolarWinds and Talend’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SolarWinds 20.52% 19.24% 12.70%
Talend -21.00% -454.15% -18.34%

Institutional and Insider Ownership

45.6% of Talend shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SolarWinds N/A N/A N/A $1.18 50.83
Talend $148.60 million 8.34 -$24.24 million ($1.08) -39.36

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

SolarWinds Company Profile

SolarWinds, Inc. (SolarWinds) is a holding company. The Company designs, develops, markets, sells and supports enterprise-class information technology (IT), infrastructure management software to IT and DevOps professionals in organizations of all sizes. Its products categories include network management, which is used to monitor and manage the performance of network infrastructure; systems management, which is used to monitor and manage the performance of applications, physical and virtual servers, storage and databases; MSP, which is used by managed service providers to monitor and manage the IT infrastructure of their end clients, SMBs, and cloud, its cloud-based products, which are used to monitor and manage applications and application infrastructure. Its customers include small- and mid-size businesses, enterprises, MSPs, and local, state and federal Government entities.

Talend Company Profile

Talend SA is a provider of open source integration solutions for data-oriented companies and integration platform under Apache Spark. The Company’s platform enables users to connect data and applications on-premise or in the cloud, in real time or in batch, Big Data or reference data. Its commercial products are Data Fabric, Big Data Integration, Real-Time Big Data, Data Preparation, Data Integration, Cloud Integration, Data Quality, Application Integration, Master Data Management and metadata Manager. Its free products are Data Preparation and Talend Open Studio, including Open Studio for Big Data, Open Studio for Data Integration, Open Studio for Data Quality, Open Studio for ESB and Open Studio for MDM. Its product, Talend Data Fabric, is a data platform. Talend Data Fabric combines big data, data integration, cloud, reference data management, data preparation and application integration in a single platform with a common development environment and management.

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