CS Disco (NYSE:LAW – Get Free Report) and SoundThinking (NASDAQ:SSTI – Get Free Report) are both small-cap technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for CS Disco and SoundThinking, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| CS Disco | 1 | 1 | 2 | 0 | 2.25 |
| SoundThinking | 1 | 5 | 1 | 0 | 2.00 |
CS Disco currently has a consensus target price of $8.00, suggesting a potential upside of 90.70%. SoundThinking has a consensus target price of $10.83, suggesting a potential upside of 87.43%. Given CS Disco’s stronger consensus rating and higher possible upside, analysts plainly believe CS Disco is more favorable than SoundThinking.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| CS Disco | -24.20% | -26.58% | -19.89% |
| SoundThinking | -16.92% | -23.77% | -12.90% |
Valuation & Earnings
This table compares CS Disco and SoundThinking”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| CS Disco | $156.85 million | 1.74 | -$44.37 million | ($0.63) | -6.66 |
| SoundThinking | $104.13 million | 0.72 | -$9.42 million | ($1.29) | -4.48 |
SoundThinking has lower revenue, but higher earnings than CS Disco. CS Disco is trading at a lower price-to-earnings ratio than SoundThinking, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
CS Disco has a beta of 1.88, meaning that its stock price is 88% more volatile than the S&P 500. Comparatively, SoundThinking has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.
Institutional & Insider Ownership
58.1% of CS Disco shares are held by institutional investors. Comparatively, 60.7% of SoundThinking shares are held by institutional investors. 16.8% of CS Disco shares are held by company insiders. Comparatively, 10.9% of SoundThinking shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Summary
CS Disco beats SoundThinking on 8 of the 14 factors compared between the two stocks.
About CS Disco
CS Disco, Inc. provides cloud-native and artificial intelligence-powered legal solutions for legal hold, legal request, ediscovery, legal document review, and case management in the United States and internationally. It offers DISCO Request, a solution that automates response compliance for legal requests; and DISCO Ediscovery, a solution that automates the ediscovery process and saves legal departments from manual tasks associated with collecting, processing, enriching, searching, reviewing, analyzing, producing, and using enterprise data that is at issue in legal matters. The company also provides DISCO Hold, a solution that automates manual work to preserve data, notify custodians, track holds with a defensible audit trail, and collect data when ready; DISCO Review, an AI-powered document review solution that delivers legal document reviews; and DISCO Case Builder, a solution that allows legal professionals to collaborate with teams to build a compelling case by offering a single place to search, organize, and review witness testimony and other legal data. The company's solutions are used in various legal matters comprising litigation, investigation, compliance, and diligence. It serves enterprises, law firms, legal services providers, and governments. CS Disco, Inc. was founded in 2012 and is headquartered in Austin, Texas.
About SoundThinking
SoundThinking, Inc., a public safety technology company that provides transformative solutions and strategic advisory services for law enforcement and civic leadership. Its SafetySmart Platform, an integrated suite of data-driven tools that enable law enforcement and community violence prevention and health organizations to be efficient in public safety outcomes. It offers ShotSpotter, an acoustic gunshot detection system; CrimeTracer, a law enforcement search engine; CaseBuilder, an investigation management system; and ResourceRouter, a software that directs patrol and community anti-violence resources to help maximize their impact. The company sells its solutions through its direct sales teams. The company was formerly known as ShotSpotter, Inc. and changed its name to SoundThinking, Inc. in April 2023. SoundThinking, Inc. was founded in 1996 and is headquartered in Fremont, California.
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