Critical Analysis: Aware (NASDAQ:AWRE) & Autodesk (NASDAQ:ADSK)

Aware (NASDAQ:AWRE) and Autodesk (NASDAQ:ADSK) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Volatility and Risk

Aware has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500. Comparatively, Autodesk has a beta of 1.27, meaning that its stock price is 27% more volatile than the S&P 500.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aware	$17.29 million	1.18	-$5.87 million	($0.39)	-2.40
Autodesk	$7.79 billion	6.96	$1.12 billion	$7.73	33.57

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

Analyst Ratings

This is a summary of recent ratings for Aware and Autodesk, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aware	1	0	0	0	1.00
Autodesk	0	5	27	0	2.84

Autodesk has a consensus target price of $319.97, suggesting a potential upside of 23.31%. Given Autodesk’s stronger consensus rating and higher possible upside, analysts clearly believe Autodesk is more favorable than Aware.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Aware	-52.60%	-36.87%	-25.29%
Autodesk	21.08%	58.63%	15.10%

Institutional and Insider Ownership

24.4% of Aware shares are held by institutional investors. Comparatively, 90.2% of Autodesk shares are held by institutional investors. 34.3% of Aware shares are held by company insiders. Comparatively, 0.1% of Autodesk shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Autodesk beats Aware on 13 of the 14 factors compared between the two stocks.

About Aware

Aware, Inc. (NASDAQ: AWRE) develops biometric software and identity-management solutions for government and commercial organizations. Its technology supports the collection, processing, storage, matching and management of biometric data, including fingerprints, facial images and iris images. The company’s product portfolio includes automated biometric identification systems, biometric data-management platforms, software development kits and mobile enrollment and authentication tools. These solutions are designed for applications such as civil identity programs, border management, law enforcement, defense, public safety and secure digital authentication.

About Autodesk

Autodesk, Inc. develops software and cloud-based services for designing, building, making, and creating digital media. Its tools support professionals and organizations across architecture, engineering, construction, manufacturing, and entertainment. The company’s products include AutoCAD for computer-aided design, Revit for building information modeling, Fusion for product design and manufacturing, and Maya and 3ds Max for 3D animation and visual effects. Autodesk also offers cloud services that help customers collaborate and manage design and construction projects.