Comparing Cango (NYSE:CANG) & Sprout Social (NASDAQ:SPT)

Sprout Social (NASDAQ:SPT) and Cango (NYSE:CANG) are both small-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations for Sprout Social and Cango, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprout Social	1	6	6	0	2.38
Cango	1	1	1	1	2.50

Sprout Social presently has a consensus price target of $21.91, suggesting a potential upside of 227.49%. Cango has a consensus price target of $3.00, suggesting a potential upside of 260.58%. Given Cango’s stronger consensus rating and higher possible upside, analysts clearly believe Cango is more favorable than Sprout Social.

Profitability

This table compares Sprout Social and Cango’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sprout Social	-10.59%	-18.93%	-7.76%
Cango	-46.40%	2.29%	1.31%

Insider & Institutional Ownership

4.2% of Cango shares are owned by institutional investors. 10.1% of Sprout Social shares are owned by insiders. Comparatively, 29.1% of Cango shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Sprout Social has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500. Comparatively, Cango has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500.

Valuation & Earnings

This table compares Sprout Social and Cango”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprout Social	$405.91 million	0.98	-$61.97 million	($0.81)	-8.26
Cango	$110.21 million	1.57	$41.07 million	($1.30)	-0.64

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

Summary

Cango beats Sprout Social on 10 of the 15 factors compared between the two stocks.

About Sprout Social

Sprout Social, Inc. designs, develops, and operates a web-based social media management platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company provides cloud software for social messaging, data and workflows in a unified system of record, intelligence, and action. It offers integrated tools, such as social engagement/response; publishing; reporting and analytics; social listening and business intelligence; reputation management; social commerce; employee advocacy; and automation and workflows. In addition, the company provides smart inbox, social customer relationship management, social monitoring and alerts, customer service tools, and automation; and centralized content planning, creation, and publishing, automated scheduling, content performance reporting, suggested content, message approval workflows, publishing permissions and governance, and content and asset libraries. Further, it offers social media; content performance, customer service and team, custom report builder, and reporting API; and market research, brand health, competitive insights, consumer trends, and product feedback; and social commerce, reputation management, employee advocacy, mobile applications, and chat bot creation and management. Additionally, the company offers professional services consisting of consulting and training services. It serves social and community management; public relations; marketing; influencer marketing; customer service and care; commerce, sales and customer acquisition; recruiting and hiring, product development, and business strategy; and small-and-medium-sized businesses, mid-market companies, enterprises, marketing agencies, government, non-profit, and educational institutions. Sprout Social, Inc. was incorporated in 2010 and is headquartered in Chicago, Illinois.

About Cango

Cango Inc. operates an automotive transaction service platform that connects dealers, original equipment manufacturers, financial institutions, car buyers, insurance brokers, and companies in the People's Republic of China. The company offers automobile trading solutions comprising car sourcing, transaction facilitation, logistics, and warehousing support for dealers through Cango Haoche app that offers new car transaction services, and Cango U-Car app that offers used-car transaction services. It also provides automotive financing facilitation services that include facilitating financing transactions from financial institutions to car buyers, which comprises credit origination, credit assessment, credit servicing, and delinquent asset management services; facilitating financing transactions of car purchases for car buyers; and after-market services to car buyers, which includes facilitating the sale of insurance policies from insurance brokers or companies. The company was founded in 2010 and is headquartered in Shanghai, the People's Republic of China.