Analyzing Aware (NASDAQ:AWRE) and Sprout Social (NASDAQ:SPT)

Sprout Social (NASDAQ:SPT) and Aware (NASDAQ:AWRE) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitability, analyst recommendations, earnings, dividends and risk.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprout Social	$405.91 million	3.59	-$66.43 million	($1.09)	-23.13
Aware	$17.39 million	2.09	-$7.31 million	($0.22)	-7.77

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

Volatility and Risk

Sprout Social has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, Aware has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Sprout Social	-17.24%	-40.94%	-15.70%
Aware	-44.06%	-14.46%	-10.72%

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprout Social	1	7	7	0	2.40
Aware	0	0	0	0	0.00

Sprout Social presently has a consensus target price of $33.85, indicating a potential upside of 34.26%. Given Sprout Social’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Sprout Social is more favorable than Aware.

Insider and Institutional Ownership

24.4% of Aware shares are owned by institutional investors. 11.0% of Sprout Social shares are owned by company insiders. Comparatively, 28.0% of Aware shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

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.

About Aware

Aware, Inc., an authentication company, provides biometrics software products and solutions for government agencies and commercial entities in the United States, the United Kingdom, and internationally. The company offers biometric software solution, including Knomi, a mobile biometric framework which provides multiple biometric modality options; AwareABIS, an automated biometric identification system used for large-scale biometric identification and deduplication; AFIX suite used for small-scale law enforcement focused biometric identification; and AFIX Tracker for fingerprint, palmprint, and latent print identification, as well as AFIX Face, AFIX Verifier, AFIX Identifier, AFIX Comparator, AFIX Engine, and AFIX NIST Transaction Engine. It also provides BioSP, a biometric integration platform-as-a-service that enables biometric data processing and management functionality in a web services architecture; WebEnroll, a browser-based biometric enrollment and data management solution; and AwareID, a software-as-a-service that provides identity verification and continuous authentication capabilities. In addition, the company offers biometrics applications, such as Nexa line, a biometric search and match SDKs including Nexa Fingerprint, Nexa Face, Nexa Iris, and Nexa Voice; and AwareXM, an interoperable fingerprint matching SDK that provides fingerprint minutiae extraction, template generation, and fingerprint authentication. Further, it sells imaging products used in medical and advanced imaging application; and offers software maintenance, program management, and software engineering services. The company sells its products, services, and solutions through systems integrators, direct, and original equipment manufacturers and value added resellers channel. Aware, Inc. was incorporated in 1986 and is headquartered in Burlington, Massachusetts.