Reviewing CS Disco (NYSE:LAW) and PowerFleet (NASDAQ:AIOT)

PowerFleet (NASDAQ:AIOT) and CS Disco (NYSE:LAW) are both small-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Valuation and Earnings

This table compares PowerFleet and CS Disco”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PowerFleet	$443.78 million	0.75	-$20.55 million	($0.16)	-15.44
CS Disco	$156.85 million	2.73	-$44.37 million	($0.49)	-13.28

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

Risk and Volatility

PowerFleet has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500. Comparatively, CS Disco has a beta of 1.8, suggesting that its share price is 80% more volatile than the S&P 500.

Insider & Institutional Ownership

73.4% of PowerFleet shares are owned by institutional investors. Comparatively, 58.1% of CS Disco shares are owned by institutional investors. 5.9% of PowerFleet shares are owned by company insiders. Comparatively, 16.8% of CS Disco shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares PowerFleet and CS Disco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PowerFleet	-4.69%	2.36%	1.18%
CS Disco	-18.54%	-25.85%	-19.25%

Analyst Ratings

This is a breakdown of recent ratings and target prices for PowerFleet and CS Disco, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PowerFleet	1	2	2	0	2.20
CS Disco	1	1	2	0	2.25

PowerFleet currently has a consensus price target of $7.40, suggesting a potential upside of 199.60%. CS Disco has a consensus price target of $8.00, suggesting a potential upside of 22.93%. Given PowerFleet’s higher probable upside, analysts clearly believe PowerFleet is more favorable than CS Disco.

Summary

PowerFleet beats CS Disco on 9 of the 13 factors compared between the two stocks.

About PowerFleet

PowerFleet, Inc. provides software-as-a-service and Internet of Things solutions that help businesses monitor and manage vehicles, equipment, cargo and other mobile assets. Its platforms use connected devices and data analytics to provide visibility into asset location, utilization, condition and performance. Its offerings include fleet management and vehicle telematics, asset tracking, driver and safety tools, and solutions for managing equipment in warehouses and other industrial settings. These services are designed to help customers improve operational efficiency, safety and asset control.

About CS Disco

CS Disco, Inc. provides cloud-based legal technology to help law firms and corporate legal departments manage litigation and investigations. Its software supports e-discovery, the process of identifying, collecting, processing and reviewing electronically stored information for legal matters. The company’s offerings include tools for legal holds and document review, along with analytics and artificial intelligence features designed to help legal teams organize large volumes of information and find relevant material.