Financial Contrast: Couchbase (NASDAQ:BASE) and Vertex (NASDAQ:VERX)

Vertex (NASDAQ:VERX) and Couchbase (NASDAQ:BASE) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, risk, analyst recommendations, institutional ownership, valuation and earnings.

Profitability

This table compares Vertex and Couchbase’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vertex	3.20%	22.32%	6.55%
Couchbase	-39.51%	-54.84%	-29.84%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Vertex and Couchbase, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vertex	0	4	7	1	2.75
Couchbase	1	2	12	0	2.73

Vertex currently has a consensus price target of $37.30, suggesting a potential downside of 12.65%. Couchbase has a consensus price target of $23.13, suggesting a potential upside of 35.52%. Given Couchbase’s higher probable upside, analysts clearly believe Couchbase is more favorable than Vertex.

Insider and Institutional Ownership

59.1% of Vertex shares are owned by institutional investors. Comparatively, 96.1% of Couchbase shares are owned by institutional investors. 44.6% of Vertex shares are owned by insiders. Comparatively, 16.1% of Couchbase shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Vertex and Couchbase”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vertex	$572.39 million	11.60	-$13.09 million	$0.12	355.83
Couchbase	$198.82 million	4.32	-$80.18 million	($1.64)	-10.41

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

Risk & Volatility

Vertex has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500. Comparatively, Couchbase has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500.

Summary

Vertex beats Couchbase on 12 of the 15 factors compared between the two stocks.

About Vertex

Vertex, Inc., together with its subsidiaries, provides enterprise tax technology solutions for retail trade, wholesale trade, and manufacturing industries in the United States and internationally. The company offers tax determination; compliance and reporting, including workflow management tools, role-based security, and event logging; tax data management; document management; analytics and insights; pre-built integration that includes mapping data fields, and business logic and configurations; industry-specific solutions; and technology specific solutions, such as chain flow accelerator and SAP-specific tools. It provides implementation services, such as configuration, data migration and implementation, and support and training; and managed services, including tax return preparation, filing and tax payment, and notice management. The company sells its software products through software licenses and software as a service subscription. Vertex, Inc. was founded in 1978 and is headquartered in King of Prussia, Pennsylvania.

About Couchbase

Couchbase, Inc. provides cloud database platform for enterprise applications in the United States and internationally. Its database works in multiple configurations, ranging from cloud to multi- or hybrid-cloud to on-premise environments to the edge. The company offers Couchbase Capella, an automated and secure Database-as-a-Service that simplifies database management by deploying, managing, and operating Couchbase Server across cloud environments; and Couchbase Server, a multi-service NoSQL database, which provides SQL-compatible query language and SQL++ that allows for a various array of data manipulation functions. It also provides Couchbase Mobile, an embedded NoSQL database for mobile and edge devices that enables an always-on experience with high data availability, even without internet connectivity, as well as synchronization gateway that allows for secure data sync between mobile devices and the backend data store. The company sells its platform through direct sales force and an ecosystem of partners. It serves governments and organizations, as well as enterprises in various industries, including retail and e-commerce, travel and hospitality, financial services and insurance, software and technology, gaming, media and entertainment, and industrials. The company was formerly known as Membase, Inc. and changed its name to Couchbase, Inc. in February 2011. Couchbase, Inc. was incorporated in 2008 and is headquartered in Santa Clara, California.