Financial Analysis: Clicksoftware Technologies (CKSW) versus AppFolio (APPF)

Clicksoftware Technologies (NASDAQ: CKSW) and AppFolio (NASDAQ:APPF) are both small-cap enterprise software companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, risk, valuation, analyst recommendations, institutional ownership and dividends.

Insider & Institutional Ownership

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27.4% of AppFolio shares are owned by institutional investors. 44.8% of AppFolio shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Clicksoftware Technologies and AppFolio, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Clicksoftware Technologies 0 0 0 0 N/A
AppFolio 0 4 0 0 2.00

AppFolio has a consensus price target of $42.50, suggesting a potential upside of 1.19%. Given AppFolio’s higher possible upside, analysts clearly believe AppFolio is more favorable than Clicksoftware Technologies.

Profitability

This table compares Clicksoftware Technologies and AppFolio’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Clicksoftware Technologies -17.41% -33.03% -19.26%
AppFolio 6.76% 12.48% 9.52%

Valuation & Earnings

This table compares Clicksoftware Technologies and AppFolio’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Clicksoftware Technologies N/A N/A N/A ($0.17) -74.12
AppFolio $143.80 million 9.95 $9.71 million $0.27 155.56

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

Volatility & Risk

Clicksoftware Technologies has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500. Comparatively, AppFolio has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Summary

AppFolio beats Clicksoftware Technologies on 9 of the 10 factors compared between the two stocks.

Clicksoftware Technologies Company Profile

ClickSoftware Technologies Ltd. is a provider of software products and solutions for workforce management and optimization both for mobile and in-house resources. The Company’s solutions are grouped into four main suites, which together comprise its Service Optimization Suite: Field Service Daily Suite, Roster (Shift Planning) Suite, Mobility Suite, and Forecasting and Planning Suite. Field Service Daily Suite covers automatic decision making and optimization support to manage field service operations. Roster (Shift Planning) Suite covers shift planning needs for both the manager, as well as the employee. Mobility Suite covers the needs of the mobile individual and back-office staff for field data communication. Forecasting and Planning Suite covers tactical short term resource planning. The Company operates as a wholly owned subsidiary of Francisco Partners.

AppFolio Company Profile

AppFolio, Inc. is a provider of industry-specific, cloud-based software solutions for small and medium-sized businesses (SMBs) in the property management and legal industries. The Company’s mobile-optimized software solutions enable its customers to work at any time and from anywhere across multiple devices. Its property management software provides small and medium-sized property managers with an end-to-end solution to their business needs. The Company’s legal software provides solo practitioners and small law firms with a streamlined practice and case management solution, allowing them to manage their practices and case load. It also offers Value+ services, such as its professionally designed Websites and electronic payment services. The Company’s property manager customers include third-party managers and owner-operators, managing single- and multi-family residences, commercial property and student housing, as well as mixed real estate portfolios.

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