Contrasting Thoughtworks (NASDAQ:TWKS) & Semantix (NASDAQ:STIX)

Thoughtworks (NASDAQ:TWKS) and Semantix (NASDAQ:STIX) are both small-cap business services companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, valuation and earnings.

Analyst Ratings

This is a breakdown of current ratings and target prices for Thoughtworks and Semantix, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Thoughtworks	1	8	1	0	2.00
Semantix	0	0	0	0	N/A

Thoughtworks presently has a consensus target price of $4.18, indicating a potential downside of 5.11%. Given Thoughtworks’ higher possible upside, equities research analysts clearly believe Thoughtworks is more favorable than Semantix.

Earnings & Valuation

This table compares Thoughtworks and Semantix”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Thoughtworks	$1.03 billion	1.38	-$68.66 million	($0.29)	-15.17
Semantix	$264.23 million	0.00	-$63.61 million	($0.81)	0.00

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

Volatility and Risk

Thoughtworks has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, Semantix has a beta of -0.37, suggesting that its stock price is 137% less volatile than the S&P 500.

Profitability

This table compares Thoughtworks and Semantix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Thoughtworks	-11.20%	-5.81%	-3.42%
Semantix	-69.49%	-45.45%	-26.98%

Insider & Institutional Ownership

32.8% of Thoughtworks shares are owned by institutional investors. Comparatively, 40.1% of Semantix shares are owned by institutional investors. 2.3% of Thoughtworks shares are owned by insiders. Comparatively, 35.5% of Semantix shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Thoughtworks beats Semantix on 9 of the 13 factors compared between the two stocks.

About Thoughtworks

Thoughtworks Holding, Inc. provides technology consultancy services in North America, the Asia Pacific, Europe, and Latin America. The company's consultancy services integrate strategy, design, and software engineering to enable enterprises and technology disruptors to thrive as modern digital businesses. It offers enterprise modernization, platforms, and cloud services, including modernization strategy and execution, digital platform strategy and engineering organization transformation, cloud modernization, cloud-native application support and evolution, and platform assessment and remediation; and customer experience, product, and design services comprising idea to market, customer experience strategy, product management transformation, and product design and delivery. The company also provides data and artificial intelligence services, such as data strategy, intelligent products, data platforms and data mesh, continuous delivery for machine learning, and data governance; digital transformation and operations services, which include delivery transformation, digital fluency, organization transformation, value-driven portfolio management, technology strategy, executive advisory, and digital foundations training; and DAMO managed services. It serves its clients in various industry verticals, including technology and business services; energy, public, and health services; retail and consumer; financial services and insurance; and automotive, travel, and transportation. The company was incorporated in 1993 and is headquartered in Chicago, Illinois.

About Semantix

Semantix, Inc., together with its subsidiaries, provides end-to-end proprietary Software as a Service (SaaS) data platform in Latin America and the United States. The company offers SDP, a multi-cloud SaaS data platform that provides data integration, data operations, machine learning operations, data governance, data sharing, and data visualization for financial institutions; healthcare plans operators, health insurance brokers, hospitals, clinics, and imaging and diagnostics facilities; and retailers. It also sells third-party software licenses to the finance, retail, telecommunications, healthcare, industrials, and other sectors. In addition, the company offers artificial intelligence and data analytics services, including consulting, cloud monitoring, data integration, data science, and data engineering. The company was founded in 2010 and is based in São Paulo, Brazil.