BILL (NYSE:BILL) versus Sprout Social (NASDAQ:SPT) Critical Analysis

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

Earnings & Valuation

This table compares BILL and Sprout Social”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BILL	$1.65 billion	2.35	-$11.24 million	($0.13)	-351.11
Sprout Social	$457.55 million	1.54	-$43.33 million	($0.50)	-23.31

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

Analyst Ratings

This is a summary of current ratings and price targets for BILL and Sprout Social, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BILL	1	7	11	1	2.60
Sprout Social	2	4	4	0	2.20

BILL currently has a consensus target price of $58.67, suggesting a potential upside of 28.53%. Sprout Social has a consensus target price of $10.88, suggesting a potential downside of 6.69%. Given BILL’s stronger consensus rating and higher possible upside, research analysts clearly believe BILL is more favorable than Sprout Social.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
BILL	-0.68%	3.74%	1.39%
Sprout Social	-6.13%	-8.80%	-3.64%

Insider & Institutional Ownership

98.0% of BILL shares are held by institutional investors. 13.2% of BILL shares are held by insiders. Comparatively, 9.6% of Sprout Social shares are held by insiders. 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.

Volatility and Risk

BILL has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, Sprout Social has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.

Summary

BILL beats Sprout Social on 14 of the 15 factors compared between the two stocks.

About BILL

BILL Holdings, Inc. provides financial automation software for small and midsize businesses worldwide. The company provides software-as-a-service, cloud-based payments, and spend management products, which allow users to automate accounts payable and accounts receivable transactions, as well as enable users to connect with their suppliers and/or customers to do business, eliminate expense reports, manage cash flows, and improve office efficiency. It also offers onboarding implementation support, and ongoing support and training services. In addition, the company's artificial intelligence enabled software provides connections between suppliers and clients. It serves accounting firms, financial institutions, and software companies. The company was formerly known as Bill.com Holdings, Inc. and changed its name to BILL Holdings, Inc. in February 2023. BILL Holdings, Inc. was incorporated in 2006 and is headquartered in San Jose, California.

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.