Reviewing Doximity (NYSE:DOCS) & Nextdoor (NYSE:NXDR)

Nextdoor (NYSE:NXDR) and Doximity (NYSE:DOCS) are both services companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, institutional ownership, profitability, earnings and risk.

Institutional and Insider Ownership

35.7% of Nextdoor shares are owned by institutional investors. Comparatively, 87.2% of Doximity shares are owned by institutional investors. 33.4% of Nextdoor shares are owned by company insiders. Comparatively, 31.8% of Doximity shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Nextdoor and Doximity”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nextdoor	$257.65 million	3.40	-$54.20 million	($0.11)	-20.86
Doximity	$644.86 million	6.09	$196.05 million	$0.99	21.70

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

Profitability

This table compares Nextdoor and Doximity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nextdoor	-16.47%	-9.22%	-8.13%
Doximity	30.40%	20.40%	17.43%

Volatility & Risk

Nextdoor has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500. Comparatively, Doximity has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Nextdoor and Doximity, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nextdoor	1	3	0	0	1.75
Doximity	3	13	6	2	2.29

Nextdoor currently has a consensus target price of $2.17, indicating a potential downside of 5.23%. Doximity has a consensus target price of $29.33, indicating a potential upside of 36.54%. Given Doximity’s stronger consensus rating and higher probable upside, analysts clearly believe Doximity is more favorable than Nextdoor.

Summary

Doximity beats Nextdoor on 13 of the 15 factors compared between the two stocks.

About Nextdoor

Nextdoor Holdings, Inc. operates as the neighborhood network that connects neighbors, businesses, and public services in the United States and internationally. It enables small and mid-sized businesses, large brands, public agencies, and nonprofits to receive information, give and get help, and build connections. The company is headquartered in San Francisco, California.

About Doximity

Doximity, Inc. operates a cloud-based digital platform for medical professionals in the United States. The company’s cloud-based platform provides its members with tools built for medical professionals, enabling them to collaborate with their colleagues, coordinate patient care, conduct virtual patient visits, stay up-to-date with the latest medical news and research, and manage their careers. It primarily serves pharmaceutical companies and health systems. The company was formerly known as 3MD Communications, Inc. and changed its name to Doximity, Inc. in June 2010. Doximity, Inc. was incorporated in 2010 and is headquartered in San Francisco, California.