Critical Analysis: VTEX (NYSE:VTEX) vs. Temenos Group (OTCMKTS:TMSNY)

Temenos Group (OTCMKTS:TMSNY) and VTEX (NYSE:VTEX) are both technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, dividends, analyst recommendations, institutional ownership, risk and valuation.

Risk & Volatility

Temenos Group has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500. Comparatively, VTEX has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Insider & Institutional Ownership

63.7% of VTEX shares are held by institutional investors. 40.9% of VTEX shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Temenos Group and VTEX, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Temenos Group	0	2	0	2	3.00
VTEX	0	6	3	0	2.33

VTEX has a consensus price target of $4.69, suggesting a potential upside of 30.39%. Given VTEX’s higher probable upside, analysts clearly believe VTEX is more favorable than Temenos Group.

Earnings and Valuation

This table compares Temenos Group and VTEX”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Temenos Group	$1.09 billion	5.11	$280.61 million	$2.83	28.74
VTEX	$240.52 million	2.55	$20.01 million	$0.16	22.47

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

Profitability

This table compares Temenos Group and VTEX’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Temenos Group	17.50%	55.57%	10.62%
VTEX	11.98%	12.98%	8.76%

Summary

Temenos Group beats VTEX on 10 of the 15 factors compared between the two stocks.

About Temenos Group

Temenos AG develops, markets, and sells integrated banking software systems to banking and other financial institutions worldwide. Its Temenos Banking Cloud helps banks to offer open banking services. The company provides Temenos Infinity, a digital banking platform; Temenos Transact, a core banking software for retail, corporate, treasury, wealth, and payments; Temenos Payments, a software-as-a-service payments technology; Temenos Multifonds, a platform for traditional and alternative funds, as well as offers key asset servicing, position keeping, valuation and accounting functions for various structures of pooled vehicles and funds; Temenos Multifonds Navigator, a net asset value shadow, oversight, and contingency solution; and Temenos Quantum, a multi-experience development platform. It also offers Temenos XAI that enables banks to provide individualized customer experiences, drive customer loyalty and profitability, and automate processes; Temenos Financial Crime Mitigation that allows banks and financial institutions to avoid regulatory fines, detect fraud, and mitigate reputational risks; Temenos Analytics, a reporting, analytics, and business intelligence product; Temenos Regulatory Compliance for addressing fraud, remaining compliant with regulations, and managing risks; Temenos Wealth, an integrated portfolio management and securities trading platform for wealth managers and private bankers; and Temenos DataSource, an enterprise data management solution. In addition, it provides various solutions for retail, business, universal, central, Islamic, corporate, and private banking; life and pension; challenger banks and fintechs; wealth management; credit unions; financial inclusion; and asset managers and asset services. The company was formerly known as Temenos Group AG and changed its name to Temenos AG in May 2018. The company was founded in 1993 and is based in Geneva, Switzerland.

About VTEX

VTEX provides software-as-a-service digital commerce platform for enterprise brands and retailers. Its platform enables customers to execute their commerce strategy, including building online stores, integrating, and managing orders across channels, and creating marketplaces to sell products from third-party vendors. It has operations in Brazil, Argentina, Chile, Colombia, France, Italy, Mexico, Peru, Portugal, Romania, Singapore, Spain, the United Kingdom, and the United States. VTEX was founded in 2000 and is headquartered in London, the United Kingdom.