Analyzing Netcapital (NASDAQ:NCPL) & XIAO-I (NASDAQ:AIXI)

XIAO-I (NASDAQ:AIXI) and Netcapital (NASDAQ:NCPL) are both small-cap business services companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Insider and Institutional Ownership

4.0% of XIAO-I shares are owned by institutional investors. Comparatively, 30.7% of Netcapital shares are owned by institutional investors. 4.9% of Netcapital shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares XIAO-I and Netcapital”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
XIAO-I	$70.31 million	0.13	-$14.51 million	N/A	N/A
Netcapital	$870,000.00	5.22	-$28.30 million	($18.64)	-0.05

XIAO-I has higher revenue and earnings than Netcapital.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for XIAO-I and Netcapital, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
XIAO-I	1	0	0	0	1.00
Netcapital	1	0	0	0	1.00

Profitability

This table compares XIAO-I and Netcapital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
XIAO-I	N/A	N/A	N/A
Netcapital	-3,204.47%	-34.42%	-28.97%

Risk and Volatility

XIAO-I has a beta of 2.01, suggesting that its stock price is 101% more volatile than the S&P 500. Comparatively, Netcapital has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500.

Summary

XIAO-I beats Netcapital on 6 of the 9 factors compared between the two stocks.

About XIAO-I

Xiao-I Corporation, through its subsidiary, Shanghai Xiao-i Robot Technology Co., Ltd., provides software services in the People’s Republic of China. It offers conversational AI platform that uses deep learning, data enhancement, active learning technologies for dialog management, context processing mechanisms, and driven by a learning system; knowledge fusion platform which integrates Q&A, documents, multimedia, information forms, business processes, knowledge graphs, and multimodal; intelligence voice platform to enhance intelligent speech solutions, realizing the macro processes of intelligent IVP, intelligent outbound calls, speech analysis, agent assistance, and human-computer interaction; and hyperautomation platform that integrates technologies, such as OCR, NLP, and visualized data mining and analysis that enables users to realize business and process automation. The company also provides data intelligence platform which integrates data assets, manages the entire life cycle of data that realizes the entire cycles of data integration, processing, transformation, analysis, and mining; cloud platform that integrates NLP, speech recognition, image recognition, and data analysis capabilities; and intelligent construction support platform which offers parsing, reconstruction, visualization, and multi-dimensional analysis of construction drawings. In addition, it offers vision analysis platform that uses various computer vision-related technologies to apply OCR, detection, video, and image analysis; intelligent hardware support platform which provides the framework of signal collection, processing, analysis, prediction, and others; and metaverse platform that develops virtual digital human. It serves its products to large and medium-sized contact centers, financial institutions, communication operators, government services, industrial manufacturing, medical care, and others. The company was incorporated in 2018 and is based in Shanghai, China.

About Netcapital

Netcapital Inc. operates as a fintech company. It offers Netcapital.com, an SEC-registered funding portal that enables private companies to raise capital online, as well as allows investors to invest from anywhere in the world. The company also provides various services, including automated onboarding process and filing of required regulatory documents; compliance review; custom-built offering page on its portal website; third party transfer agent and custodial services; and rolling closes which provides access to liquidity before final close date of offerings, as well as assistance with annual fillings and direct access to team for ongoing support. In addition, it offers advisor services, which includes incubation of technology start-ups; investors introduction; online marketing; website design and software development; message crafting including pitch decks, offering pages, and ad creation; strategic advice; and technology consulting services. Further, the company provides valuation services, such as business valuation, fairness and solvency opinions, ESOP feasibility and valuation, non-cash charitable contribution, economic analysis of damages, intellectual property appraisals, and compensation studies. Netcapital Inc. is based in Boston, Massachusetts.