Head to Head Survey: Vertex (NASDAQ:VERX) vs. Fastly (NYSE:FSLY)

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

Institutional and Insider Ownership

59.1% of Vertex shares are owned by institutional investors. Comparatively, 79.7% of Fastly shares are owned by institutional investors. 45.0% of Vertex shares are owned by insiders. Comparatively, 6.7% of Fastly shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Vertex and Fastly’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%
Fastly	-31.02%	-15.22%	-9.70%

Valuation & Earnings

This table compares Vertex and Fastly”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vertex	$572.39 million	9.81	-$13.09 million	$0.04	903.00
Fastly	$531.48 million	1.82	-$133.09 million	($1.00)	-7.07

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

Analyst Recommendations

This is a breakdown of recent ratings for Vertex and Fastly, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vertex	0	4	7	1	2.75
Fastly	1	6	0	1	2.13

Vertex currently has a consensus target price of $37.30, indicating a potential upside of 3.50%. Fastly has a consensus target price of $7.81, indicating a potential upside of 9.57%. Given Fastly’s higher probable upside, analysts plainly believe Fastly is more favorable than Vertex.

Risk & Volatility

Vertex has a beta of 0.69, suggesting that its share price is 31% less volatile than the S&P 500. Comparatively, Fastly has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500.

Summary

Vertex beats Fastly on 11 of the 14 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 Fastly

Fastly, Inc. operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet. The company offers network services to speed up and optimize the delivery of web and application traffic; device detection and geolocation; content delivery network, such as dynamic site acceleration, origin shield, instant purge, surrogate keys, programmatic control, content compression, reliability features, fanout, domainr, privacy, and modern protocols and performance services; and video/ streaming solutions and services, including live streaming, video on demand, and media shield. It also provides security solutions, such as DDoS protection, next-gen WAF, bot management, API and ATO protection, advanced rate limiting, and compliance services; load balancing; image optimization; transport layer security (TLS), platform TLS, and certainly; and origin connect. It serves customers operating in digital publishing, media and entertainment, technology, online education, travel and hospitality, and financial services industries. The company was formerly known as SkyCache, Inc. and changed its name to Fastly, Inc. in May 2012. Fastly, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.