Financial Analysis: 8X8 (NASDAQ:EGHT) versus HeartCore Enterprises (NASDAQ:HTCR)

8X8 (NASDAQ:EGHT) and HeartCore Enterprises (NASDAQ:HTCR) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Institutional & Insider Ownership

94.0% of 8X8 shares are held by institutional investors. Comparatively, 1.7% of HeartCore Enterprises shares are held by institutional investors. 1.2% of 8X8 shares are held by company insiders. Comparatively, 64.2% of HeartCore Enterprises shares are held 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.

Volatility & Risk

8X8 has a beta of 1.78, meaning that its stock price is 78% more volatile than the S&P 500. Comparatively, HeartCore Enterprises has a beta of 1.75, meaning that its stock price is 75% more volatile than the S&P 500.

Profitability

This table compares 8X8 and HeartCore Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
8X8	-6.33%	-1.45%	-0.21%
HeartCore Enterprises	16.25%	65.33%	22.92%

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
8X8	$717.44 million	0.37	-$67.59 million	($0.36)	-5.56
HeartCore Enterprises	$30.29 million	0.52	-$4.19 million	$0.24	3.13

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for 8X8 and HeartCore Enterprises, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
8X8	3	2	3	0	2.00
HeartCore Enterprises	0	0	0	0	0.00

8X8 currently has a consensus price target of $2.99, suggesting a potential upside of 49.29%. Given 8X8’s stronger consensus rating and higher probable upside, research analysts clearly believe 8X8 is more favorable than HeartCore Enterprises.

Summary

HeartCore Enterprises beats 8X8 on 8 of the 14 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 HeartCore Enterprises

HeartCore Enterprises, Inc., a software development company, provides Software as a Service solutions to enterprise customers in Japan and internationally. Its customer experience management platform includes marketing, sales, service, and content management systems, as well as other tools and integrations, which enable companies to enhance the customer experience and drive engagement. The company also operates a digital transformation business that offers customers with robotics process automation, process mining, and task mining to accelerate the digital transformation of enterprises. In addition, it provides consulting services; and education, services, and support solutions. The company was founded in 2009 and is headquartered in Tokyo, Japan.