Comparing Stem (NYSE:STEM) & Bentley Systems (NASDAQ:BSY)

Stem (NYSE:STEM) and Bentley Systems (NASDAQ:BSY) are both technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Stem and Bentley Systems, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stem	1	4	1	0	2.00
Bentley Systems	0	5	10	0	2.67

Stem presently has a consensus target price of $6.54, indicating a potential upside of 116.76%. Bentley Systems has a consensus target price of $44.77, indicating a potential upside of 12.77%. Given Stem’s higher probable upside, research analysts clearly believe Stem is more favorable than Bentley Systems.

Profitability

This table compares Stem and Bentley Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stem	-49.37%	N/A	-21.85%
Bentley Systems	18.10%	28.43%	9.69%

Volatility and Risk

Stem has a beta of 1.58, suggesting that its stock price is 58% more volatile than the S&P 500. Comparatively, Bentley Systems has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500.

Valuation & Earnings

This table compares Stem and Bentley Systems”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stem	$156.27 million	0.19	$137.76 million	($8.49)	-0.36
Bentley Systems	$1.50 billion	7.68	$277.86 million	$0.91	43.63

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

Insider and Institutional Ownership

61.6% of Stem shares are held by institutional investors. Comparatively, 44.2% of Bentley Systems shares are held by institutional investors. 5.1% of Stem shares are held by company insiders. Comparatively, 20.3% of Bentley Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Bentley Systems beats Stem on 11 of the 14 factors compared between the two stocks.

About Stem

Stem, Inc. operates as a digitally connected, intelligent, and renewable energy storage network provider worldwide. The company offers energy storage hardware sourced from original equipment manufacturers (OEMs); edge hardware to aid in the collection of site data and real-time operation and control of the site and other optional equipment; and Athena, a software platform, which offers battery hardware and software-enabled services to operate the energy storage systems. It serves commercial and industrial enterprises, independent power producers, renewable project developers, and utilities and grid operators. The company was incorporated in 2009 and is headquartered in San Francisco, California.

About Bentley Systems

Bentley Systems, Incorporated, together with its subsidiaries, provides infrastructure engineering software solutions in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. The company offers open modeling engineering applications, such as MicroStation, OpenBridge, OpenBuildings, OpenCities, OpenComms, OpenFlows, OpenPlant, OpenRail, OpenRoads, OpenSite, OpenTower, OpenTunnel, OpenUtilities, and OpenWindowPower; and open simulation engineering applications, including ADINA, AutoPIPE, CUBE, DYNAMEQ, EMME, LEGION, Power Line Systems, RAM, SACS, SPIDA, and STAAD; and geoprofessional applications for modeling and simulation of near and deep subsurface conditions, including AGS, Central, GeoStudio, Imago, Leapfrog, MX Deposit, Oasis montaj, OpenGround, and PLAXIS. It also provides infrastructure cloud applications, such as ProjectWise, SYNCHRO, and AssetWise, as well as iTwin platform that enables users to create and curate cloud native 4D/5D digital representations of physical infrastructure assets consisting of iTwin Capture, iTwin Experience, and iTwin IoT platforms. The company serves civil, structural, geotechnical, subsurface, process engineers, architects, geospatial professionals, city and regional planners, contractors, fabricators, and operations and maintenance engineers. Bentley Systems, Incorporated was incorporated in 1984 and is headquartered in Exton, Pennsylvania.