Head-To-Head Contrast: SPS Commerce (NASDAQ:SPSC) versus Itex (OTCMKTS:ITEX)

SPS Commerce (NASDAQ:SPSC) and Itex (OTCMKTS:ITEX) are both business services companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Valuation and Earnings

This table compares SPS Commerce and Itex”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SPS Commerce	$637.77 million	6.30	$77.05 million	$2.18	48.59
Itex	$6.13 million	0.67	$700,000.00	N/A	N/A

SPS Commerce has higher revenue and earnings than Itex.

Analyst Recommendations

This is a summary of current ratings and target prices for SPS Commerce and Itex, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SPS Commerce	0	6	5	0	2.45
Itex	0	0	0	0	0.00

SPS Commerce currently has a consensus target price of $156.70, suggesting a potential upside of 47.93%. Given SPS Commerce’s stronger consensus rating and higher probable upside, equities analysts clearly believe SPS Commerce is more favorable than Itex.

Profitability

This table compares SPS Commerce and Itex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SPS Commerce	11.79%	12.10%	10.08%
Itex	N/A	N/A	N/A

Institutional & Insider Ownership

99.0% of SPS Commerce shares are owned by institutional investors. 1.0% of SPS Commerce shares are owned by company insiders. Comparatively, 32.0% of Itex shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

SPS Commerce has a beta of 0.69, suggesting that its share price is 31% less volatile than the S&P 500. Comparatively, Itex has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500.

Summary

SPS Commerce beats Itex on 11 of the 12 factors compared between the two stocks.

About SPS Commerce

SPS Commerce, Inc. provides cloud-based supply chain management solutions in the United States and internationally. It offers solutions through the SPS Commerce, a cloud-based platform that enhances the way retailers, grocers, suppliers, distributors, and logistics firms manage and fulfill omnichannel orders, optimize sell-through performance, and automate new trading relationships. The company also provides Fulfillment, an electronic data interchange solution that scales as a business grows, where companies use a single system to manage orders and logistics from various sales channels, including wholesale, eCommerce, and marketplaces; and Analytics product that enables organizations to enhance visibility into how products are selling through a single connection across various sales channels, including wholesale, eCommerce, and marketplaces, as well as enhances access and usage of sales and inventory data through a combination of analytics applications, network of connections, and industry-leading expertise. In addition, it offers various complimentary products, such as assortment product, which simplifies the communication of robust, accurate item data by automatically translating item attributes, and hierarchies; and community product that allows organizations to accelerate digitization of their supply chain and improve collaboration with suppliers through change management and onboarding programs. The company was formerly known as St. Paul Software, Inc. and changed its name to SPS Commerce, Inc. in May 2001. SPS Commerce, Inc. was incorporated in 1987 and is headquartered in Minneapolis, Minnesota.

About Itex

ITEX Corporation operates a marketplace in which products and services are exchanged by marketplace members without exchanging cash in the United States. The company’s marketplace provides a forum for members to purchase from and sell their products and services to other members using ITEX dollars instead of United States dollars. It also administers the marketplace, as well as provides record-keeping and payment transaction processing services. In addition, the company services its member businesses through its independent licensed brokers and franchise network. ITEX Corporation was founded in 1982 and is headquartered in Bellevue, Washington.