Financial Analysis: Salesforce (NYSE:CRM) & NetSol Technologies (NASDAQ:NTWK)

NetSol Technologies (NASDAQ:NTWK) and Salesforce (NYSE:CRM) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.

Analyst Recommendations

This is a breakdown of recent recommendations for NetSol Technologies and Salesforce, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NetSol Technologies	0	1	0	0	2.00
Salesforce	1	13	25	0	2.62

Salesforce has a consensus price target of $325.23, suggesting a potential upside of 27.58%. Given Salesforce’s stronger consensus rating and higher possible upside, analysts clearly believe Salesforce is more favorable than NetSol Technologies.

Institutional & Insider Ownership

16.0% of NetSol Technologies shares are owned by institutional investors. Comparatively, 80.4% of Salesforce shares are owned by institutional investors. 15.0% of NetSol Technologies shares are owned by company insiders. Comparatively, 3.0% of Salesforce shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

NetSol Technologies has a beta of 1.1, suggesting that its stock price is 10% more volatile than the S&P 500. Comparatively, Salesforce has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Profitability

This table compares NetSol Technologies and Salesforce’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NetSol Technologies	4.46%	7.40%	4.86%
Salesforce	16.87%	13.27%	8.21%

Valuation & Earnings

This table compares NetSol Technologies and Salesforce”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NetSol Technologies	$66.09 million	0.78	$2.92 million	$0.25	17.52
Salesforce	$37.90 billion	6.40	$6.20 billion	$6.88	37.05

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

Summary

Salesforce beats NetSol Technologies on 13 of the 14 factors compared between the two stocks.

About NetSol Technologies

NetSol Technologies, Inc. designs, develops, markets, and exports enterprise software solutions to the automobile financing and leasing, banking, and financial services industries worldwide. The company offers NFS Ascent, a suite of financial applications for businesses in the finance and leasing industry. Its NFS Ascent constituent applications include Omni Point of Sale, a web-based application; Contract Management System (CMS), an application for managing and maintaining credit contracts; Wholesale Finance System (WFS), a system for automating and managing the lifecycle of wholesale finance; Dealer Auditor Access System, a web-based solution that could be used in conjunction with WFS or any third-party wholesale finance system; NFS Ascent deployed on The Cloud, a cloud-version of NFS Ascent; and NFS Digital, that includes Self Point of Sale, Mobile Account, Mobile Point of Sale, Mobile Dealer, Mobile Auditor, Mobile Collector, and Mobile Field Investigator. The company also provides Otoz Digital Auto-Retail and mobility orchestration, a white-label SaaS platform; Otoz Ecosystem, an API-based architecture; and Otoz Platform, a white label platform, which includes Dealer/Admin Tool and Customer Portals. In addition, it offers system integration, consulting, and information technology products and services. It serves blue chip organizations, Dow-Jones 30 Industrials, Fortune 500 manufacturers and financial institutions, and vehicle manufacturers. The company was incorporated in 1997 and is headquartered in Encino, California.

About Salesforce

Salesforce, Inc. provides Customer Relationship Management (CRM) technology that brings companies and customers together worldwide. The company's service includes sales to store data, monitor leads and progress, forecast opportunities, gain insights through analytics and artificial intelligence, and deliver quotes, contracts, and invoices; and service that enables companies to deliver trusted and highly personalized customer support at scale. In addition, its platform offering comprise a flexible platform that enables companies of various sizes, locations, and industries to build business workflow and apps with customer; online learning platform that allows anyone to learn in-demand Salesforce skills; and Slack, an intelligent productivity platform. The company's marketing services enables companies to plan, personalize, automate, and optimize customer marketing journey, connecting interaction, and connected products; and commerce services, which empowers shopping experience across various customer touchpoint, such as mobile, web, social, and stores and provides click-to-code tools that offers customers to build and deploy solutions. Further, its analytics offering includes Tableau, an end-to-end analytics solution for range of enterprise use cases and intelligent analytics with AI models, spot trends, predict outcomes, creates summaries, timely recommendations, and take action from any device; and integration service including MuleSoft, which provides building blocks to deliver end-to-end and connected experiences. Additionally, the company provides data cloud, a hyperscale data engine native to Salesforce; vertical services to meet the needs of customers in industries, such as financial services, healthcare and life sciences, manufacturing and automotive and government; and offers salesforce starter for small and medium-sized businesses. Salesforce, Inc. was incorporated in 1999 and is headquartered in San Francisco, California.