Sprout Social (NASDAQ:SPT) & Autohome (NYSE:ATHM) Critical Analysis

Sprout Social (NASDAQ:SPT) and Autohome (NYSE:ATHM) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Institutional and Insider Ownership

63.1% of Autohome shares are held by institutional investors. 10.1% of Sprout Social shares are held by company insiders. Comparatively, 5.7% of Autohome shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for Sprout Social and Autohome, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprout Social	1	6	6	0	2.38
Autohome	0	2	1	1	2.75

Sprout Social currently has a consensus price target of $27.4167, suggesting a potential upside of 87.40%. Autohome has a consensus price target of $36.00, suggesting a potential upside of 27.17%. Given Sprout Social’s higher probable upside, analysts clearly believe Sprout Social is more favorable than Autohome.

Profitability

This table compares Sprout Social and Autohome’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sprout Social	-12.70%	-25.95%	-10.67%
Autohome	21.74%	7.10%	5.66%

Valuation and Earnings

This table compares Sprout Social and Autohome”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprout Social	$405.91 million	2.12	-$61.97 million	($0.95)	-15.40
Autohome	$964.42 million	3.52	$245.52 million	$1.70	16.65

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

Volatility & Risk

Sprout Social has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Autohome has a beta of -0.03, suggesting that its stock price is 103% less volatile than the S&P 500.

Summary

Autohome beats Sprout Social on 11 of the 15 factors compared between the two stocks.

About Sprout Social

Sprout Social, Inc. designs, develops, and operates a web-based social media management platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company provides cloud software for social messaging, data and workflows in a unified system of record, intelligence, and action. It offers integrated tools, such as social engagement/response; publishing; reporting and analytics; social listening and business intelligence; reputation management; social commerce; employee advocacy; and automation and workflows. In addition, the company provides smart inbox, social customer relationship management, social monitoring and alerts, customer service tools, and automation; and centralized content planning, creation, and publishing, automated scheduling, content performance reporting, suggested content, message approval workflows, publishing permissions and governance, and content and asset libraries. Further, it offers social media; content performance, customer service and team, custom report builder, and reporting API; and market research, brand health, competitive insights, consumer trends, and product feedback; and social commerce, reputation management, employee advocacy, mobile applications, and chat bot creation and management. Additionally, the company offers professional services consisting of consulting and training services. It serves social and community management; public relations; marketing; influencer marketing; customer service and care; commerce, sales and customer acquisition; recruiting and hiring, product development, and business strategy; and small-and-medium-sized businesses, mid-market companies, enterprises, marketing agencies, government, non-profit, and educational institutions. Sprout Social, Inc. was incorporated in 2010 and is headquartered in Chicago, Illinois.

About Autohome

Autohome Inc. operates as an online destination for automobile consumers in the People’s Republic of China. The company delivers interactive content and tools to automobile consumers through its three websites, autohome.com.cn, che168.com, and ttpai.cn on PCs, mobile devices, mobile applications, and mini apps. It provides media services, including automaker advertising services and regional marketing campaigns; and leads generation services comprising dealer subscription services, advertising services for individual dealers, and used automobile listing and other platform-based services. The company offers Autohome Mall, an online transaction platform; and online bidding platform for used automobiles, as well as collects commissions for facilitating transactions of auto-financing and insurance products on its platform. The company was formerly known as Sequel Limited and changed its name to Autohome Inc. in October 2011. Autohome Inc. was incorporated in 2008 and is headquartered in Beijing, the People’s Republic of China.