Freshworks (NASDAQ:FRSH) versus Audioeye (NASDAQ:AEYE) Critical Analysis

Audioeye (NASDAQ:AEYE) and Freshworks (NASDAQ:FRSH) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, valuation, risk, institutional ownership, earnings, analyst recommendations and dividends.

Volatility & Risk

Audioeye has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500. Comparatively, Freshworks has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Institutional & Insider Ownership

51.1% of Audioeye shares are owned by institutional investors. Comparatively, 75.6% of Freshworks shares are owned by institutional investors. 40.7% of Audioeye shares are owned by insiders. Comparatively, 11.2% of Freshworks shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Audioeye and Freshworks”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Audioeye	$35.20 million	2.48	-$4.25 million	($0.28)	-25.14
Freshworks	$838.81 million	2.45	$183.72 million	$0.64	11.38

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

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Audioeye and Freshworks, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Audioeye	1	0	4	0	2.60
Freshworks	1	8	7	0	2.38

Audioeye presently has a consensus target price of $20.67, suggesting a potential upside of 193.56%. Freshworks has a consensus target price of $12.92, suggesting a potential upside of 77.43%. Given Audioeye’s stronger consensus rating and higher probable upside, research analysts clearly believe Audioeye is more favorable than Freshworks.

Profitability

This table compares Audioeye and Freshworks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Audioeye	-8.88%	40.94%	9.77%
Freshworks	21.90%	4.77%	3.14%

Summary

Freshworks beats Audioeye on 8 of the 14 factors compared between the two stocks.

About Audioeye

AudioEye, Inc. provides patented, internet content publication, distribution software, and related services to Internet and other media to people regardless of their device, location, or disabilities in the United States. Its software and services enable conversion of digital content into accessible formats and allows for real time distribution to end users on any Internet connected device. The company offers AudioEye, an always-on testing, remediation, and monitoring solution that improves conformance with web content accessibility guidelines; identifies and fixes the accessibility errors and addresses a range of disabilities, including dyslexia, color blindness, epilepsy, and others; and provides additional solutions to provide for enhanced compliance and accessibility, including periodic auditing, human assisted technological remediations, and legal support services, as well as PDF remediation services, Native Mobile App and audit reports to help customers with their digital accessibility needs. The company serves small- and medium-sized businesses, corporate enterprises, non-profit organizations, and federal government agencies, as well as federal, state, and local governments and agencies through content management system partners, platform and agency partners, authorized resellers, and the marketplace. AudioEye, Inc. was incorporated in 2005 and is based in Tucson, Arizona.

About Freshworks

Freshworks Inc., a software development company, provides software-as-a-service products worldwide. It offers Freshworks Customer Service Suite, which provides automated, personalized self-service on various channels, including web, chat, mobile messaging, email, and social; Freshdesk, a ticketing-centric customer service solution; Freshsuccess, a customer success solution; and Freshchat that provides agents with a modern conversational experience to proactively engage customers across digital messaging channels. The company also provides Freshsales, an advanced and user-friendly sales automation solution; Freshmarketer, a marketing automation solution for businesses to redefine their marketing strategies; Freshsales Suite, which offers businesses a unified platform that facilitates cohesive engagement and detailed tracking of customers throughout their entire buying journey; Freshservice that offers virtual agents to help employees resolve issues, make requests, and answer questions without contacting the service desk; and Freshservice for Business Teams, which provides a unified employee service experience while ensuring the secure separation of departmental data. In addition, it offers Freshping to monitor website’s availability and get multichannel alerts if the website goes down; Freshstatus, which allows businesses to create a custom branded website status page for internal or external viewing to communicate website uptime and availability; and Freshsurvey to measure net promoter scores and other satisfaction metrics directly within Freshworks products. The company was formerly known as Freshdesk Inc. and changed its name to Freshworks Inc. in June 2017. Freshworks Inc. was incorporated in 2010 and is headquartered in San Mateo, California.