Financial Analysis: TaskUs (NASDAQ:TASK) versus Applied Digital (NASDAQ:APLD)

TaskUs (NASDAQ:TASKGet Free Report) and Applied Digital (NASDAQ:APLDGet Free Report) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.

Profitability

This table compares TaskUs and Applied Digital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TaskUs 5.44% 16.93% 8.64%
Applied Digital -88.95% -111.80% -26.35%

Analyst Ratings

This is a summary of recent ratings for TaskUs and Applied Digital, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TaskUs 1 5 2 0 2.13
Applied Digital 0 0 5 0 3.00

TaskUs presently has a consensus price target of $15.38, indicating a potential upside of 28.13%. Applied Digital has a consensus price target of $8.40, indicating a potential upside of 2.56%. Given TaskUs’ higher probable upside, research analysts clearly believe TaskUs is more favorable than Applied Digital.

Insider & Institutional Ownership

44.6% of TaskUs shares are held by institutional investors. Comparatively, 65.7% of Applied Digital shares are held by institutional investors. 29.3% of TaskUs shares are held by company insiders. Comparatively, 20.5% of Applied Digital shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares TaskUs and Applied Digital”s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TaskUs $924.36 million 1.15 $45.69 million $0.51 23.53
Applied Digital $165.58 million 6.79 -$149.27 million ($0.79) -10.37

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

Risk and Volatility

TaskUs has a beta of 2.29, indicating that its stock price is 129% more volatile than the S&P 500. Comparatively, Applied Digital has a beta of 4.51, indicating that its stock price is 351% more volatile than the S&P 500.

Summary

TaskUs beats Applied Digital on 9 of the 14 factors compared between the two stocks.

About TaskUs

(Get Free Report)

TaskUs, Inc. provides digital outsourcing services for companies in Philippines, the United States, India, and internationally. It offers digital customer experience that consists of omni-channel customer care services primarily delivered through non-voice digital channels; and other solutions, including experience and customer care services for new product or market launches, and customer acquisition solutions. The company also provides trust and safety solutions, such as review and disposition of user and advertiser generated visual, text, and audio content, which include removal or labeling of policy violating, and offensive or misleading content, as well as risk management, compliance, identity management, and fraud services; and artificial intelligence (AI) solutions that consist of data labeling, annotation, context relevance, and transcription services for training and tuning machine learning algorithms that enables to develop AI systems. It serves clients in various industry segments comprising e-commerce, FinTech, food delivery and ride sharing, gaming, technology, HealthTech, social media, and streaming media. The company was formerly known as TU TopCo, Inc. and changed its name to TaskUs, Inc. in December 2020. TaskUs, Inc. was founded in 2008 and is headquartered in New Braunfels, Texas.

About Applied Digital

(Get Free Report)

Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.

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