LivePerson (NASDAQ:LPSN – Get Free Report) and Magic Software Enterprises (NASDAQ:MGIC – Get Free Report) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.
Valuation & Earnings
This table compares LivePerson and Magic Software Enterprises’ gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| LivePerson | $401.98 million | 0.16 | -$100.43 million | ($1.44) | -0.50 |
| Magic Software Enterprises | $535.05 million | 0.99 | $37.03 million | $0.73 | 14.79 |
Magic Software Enterprises has higher revenue and earnings than LivePerson. LivePerson is trading at a lower price-to-earnings ratio than Magic Software Enterprises, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Analyst Recommendations
This is a summary of recent ratings for LivePerson and Magic Software Enterprises, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| LivePerson | 1 | 6 | 1 | 0 | 2.00 |
| Magic Software Enterprises | 0 | 0 | 1 | 0 | 3.00 |
LivePerson currently has a consensus target price of $1.38, indicating a potential upside of 91.99%. Magic Software Enterprises has a consensus target price of $14.00, indicating a potential upside of 29.63%. Given LivePerson’s higher possible upside, research analysts clearly believe LivePerson is more favorable than Magic Software Enterprises.
Institutional & Insider Ownership
79.8% of LivePerson shares are held by institutional investors. Comparatively, 24.7% of Magic Software Enterprises shares are held by institutional investors. 2.0% of LivePerson shares are held by company insiders. Comparatively, 4.5% of Magic Software Enterprises shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares LivePerson and Magic Software Enterprises’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| LivePerson | -31.27% | -56.82% | -3.45% |
| Magic Software Enterprises | 6.83% | 16.36% | 8.96% |
Summary
Magic Software Enterprises beats LivePerson on 10 of the 13 factors compared between the two stocks.
About LivePerson
LivePerson, Inc. engages in conversational artificial intelligence. It enables brands to leverage the Conversational Cloud's intelligence engine to connect with consumers through an integrated suite of mobile and online business messaging technologies. The company offers the Conversational Cloud, an enterprise-class digital customer conversation platform, which enables businesses and consumers to connect through conversational channels, such as voice, in-app, and mobile messaging. It also provides professional services; LivePerson's Conversational AI, including conversation builder, manager, and intelligence, and intent manager. In addition, it provides Voice AI, conversational intelligence and insights, and integration services. The company sells its products to Fortune 500 companies, Internet businesses, online merchants, automotive dealers, educational institution, public sector, and not-for-profit organizations. It operates in the United States, Canada, Latin America, South America, Europe, the Middle East, Africa, the United Kingdom, and the Asia-Pacific. LivePerson, Inc. was incorporated in 1995 and is headquartered in New York, New York.
About Magic Software Enterprises
Magic Software Enterprises Ltd. provides proprietary application development, vertical software solutions, business process integration, information technologies (IT) outsourcing software services, and cloud based services in Israel and internationally. The company's Software Services segment develops, markets, sells, and supports application platform, software applications, and business and process integration solutions and related services. Its IT Professional Services segment offers IT services in the areas of infrastructure design and delivery, application development, technology planning and implementation services, communications services and solutions, and supplemental outsourcing services. It also offers proprietary application platforms, such as Magic xpa for developing and deploying business applications; AppBuilder for building, deploying, and maintaining business applications; Magic xpi for application integration; Magic xpi cloud native; FactoryEye for virtualization of production data; Magic Data Management and Analytics Platform for data management; and Magic SmartUX for cross-platform mobile business applications. It also provides vertical software solutions comprising Clicks, a software solution for healthcare providers; Leap, a software solution for business support systems; Hermes Cargo, a packaged software solution for managing air cargo ground handling; HR Pulse, a single-tenant software as a service tool; MBS Solution, a system for managing TV broadcast management; Nativ, a system for management of rehabilitation centers; and Mobisale, a system for sales and distribution field activities for consumer goods manufacturers and wholesalers. In addition, the company provides software maintenance, support, training, and consulting services. The company was formerly known as Mashov Software Export (1983) Ltd. and changed its name to Magic Software Enterprises Ltd. in 1991. The company was incorporated in 1983 and is headquartered in Or Yehuda, Israel.
Receive News & Ratings for LivePerson Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for LivePerson and related companies with MarketBeat.com's FREE daily email newsletter.
