Contrasting Shopify (NYSE:SHOP) and Skillsoft (NYSE:SKIL)

Skillsoft (NYSE:SKIL) and Shopify (NYSE:SHOP) are both business services companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.

Valuation & Earnings

This table compares Skillsoft and Shopify”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Skillsoft	$536.51 million	0.21	-$349.29 million	($41.25)	-0.34
Shopify	$7.06 billion	13.43	$132.00 million	($0.17)	-432.82

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for Skillsoft and Shopify, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Skillsoft	0	1	3	0	2.75
Shopify	1	15	23	1	2.60

Skillsoft presently has a consensus price target of $36.67, indicating a potential upside of 164.17%. Shopify has a consensus price target of $77.37, indicating a potential upside of 5.31%. Given Skillsoft’s stronger consensus rating and higher possible upside, research analysts plainly believe Skillsoft is more favorable than Shopify.

Profitability

This table compares Skillsoft and Shopify’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Skillsoft	-63.42%	-41.27%	-7.99%
Shopify	16.40%	10.88%	8.71%

Institutional & Insider Ownership

87.0% of Skillsoft shares are owned by institutional investors. Comparatively, 69.3% of Shopify shares are owned by institutional investors. 13.5% of Skillsoft shares are owned by 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

Skillsoft has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500. Comparatively, Shopify has a beta of 2.35, meaning that its stock price is 135% more volatile than the S&P 500.

Summary

Shopify beats Skillsoft on 10 of the 15 factors compared between the two stocks.

About Skillsoft

Skillsoft Corp. provides content and platform and instructor-led training services in the United States and internationally. The company's Content & Platform segment engages in the sale, marketing, and delivery of its content learning solutions in areas, such as leadership and business, technology and developer, and compliance comprising individualized coaching, as well as technical skill areas. This segment also offers Percipio, an AI-driven online learning platform that delivers a learning experience through SaaS solutions. Its Instructor-Led Training segment provides training solutions, including information technology and business skills for corporations and their employees by guiding its customers throughout their lifelong technology learning journey by offering relevant and up-to-date skills training through instructor-led and self-paced, vendor certified, and other proprietary offerings. The company markets and sells their offerings to businesses of many sizes, government agencies, educational institutions, and resellers. Skillsoft Corp. is headquartered in Greenwood Village, Colorado.

About Shopify

Shopify Inc., a commerce company, provides a commerce platform and services in Canada, the United States, Europe, the Middle East, Africa, the Asia Pacific, Australia, China, and Latin America. The company's platform enables merchants to displays, manages, markets, and sells its products through various sales channels, including web and mobile storefronts, physical retail locations, pop-up shops, social media storefronts, native mobile apps, buy buttons, and marketplaces; and enables to manage products and inventory, process orders and payments, fulfill and ship orders, new buyers and build customer relationships, source products, leverage analytics and reporting, manage cash, payments and transactions, and access financing. It also sells custom themes and apps, and registration of domain names; and merchant solutions, which include accepting payments, shipping, and securing working capital. The company was formerly known as Jaded Pixel Technologies Inc. and changed its name to Shopify Inc. in November 2011. Shopify Inc. was incorporated in 2004 and is headquartered in Ottawa, Canada.