Head-To-Head Contrast: Nextdoor (NYSE:NXDR) and Commerce.com (NASDAQ:CMRC)

Nextdoor (NYSE:NXDR) and Commerce.com (NASDAQ:CMRC) are both small-cap services companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations and price targets for Nextdoor and Commerce.com, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nextdoor	1	2	0	0	1.67
Commerce.com	3	2	2	0	1.86

Nextdoor currently has a consensus price target of $2.10, indicating a potential upside of 27.66%. Commerce.com has a consensus price target of $5.17, indicating a potential upside of 64.54%. Given Commerce.com’s stronger consensus rating and higher possible upside, analysts clearly believe Commerce.com is more favorable than Nextdoor.

Earnings & Valuation

This table compares Nextdoor and Commerce.com”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nextdoor	$257.65 million	2.48	-$54.20 million	($0.14)	-11.75
Commerce.com	$342.35 million	0.75	-$19.34 million	($0.23)	-13.65

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

Volatility & Risk

Nextdoor has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500. Comparatively, Commerce.com has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500.

Institutional and Insider Ownership

35.7% of Nextdoor shares are held by institutional investors. Comparatively, 79.2% of Commerce.com shares are held by institutional investors. 33.4% of Nextdoor shares are held by insiders. Comparatively, 2.7% of Commerce.com shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Nextdoor	-21.04%	-11.48%	-10.11%
Commerce.com	-5.65%	-8.33%	-1.10%

Summary

Commerce.com beats Nextdoor on 9 of the 14 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 Commerce.com

BigCommerce Holdings, Inc. operates a software-as-a-service platform for small businesses, mid-markets, and large enterprises in the United States, Europe, the Middle East, Africa, the Asia-Pacific, and internationally. The company’s platform provides various services for launching and scaling e-commerce operation, including store design, catalog management, hosting, checkout, order management, reporting, and pre-integrations. As of December 31, 2021, it served approximately 60,000 online stores across industries. BigCommerce Holdings, Inc. was founded in 2009 and is headquartered in Austin, Texas.