Reviewing Alight (NYSE:ALIT) & Elastic (NYSE:ESTC)

Elastic (NYSE:ESTC) and Alight (NYSE:ALIT) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, valuation and profitability.

Insider & Institutional Ownership

97.0% of Elastic shares are held by institutional investors. Comparatively, 96.7% of Alight shares are held by institutional investors. 12.7% of Elastic shares are held by company insiders. Comparatively, 1.9% of Alight 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.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Elastic	$1.48 billion	6.33	-$108.11 million	($0.80)	-110.43
Alight	$2.33 billion	0.83	-$157.00 million	($2.21)	-1.62

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for Elastic and Alight, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Elastic	0	9	21	1	2.74
Alight	0	0	6	0	3.00

Elastic currently has a consensus price target of $120.00, indicating a potential upside of 35.84%. Alight has a consensus price target of $8.75, indicating a potential upside of 144.48%. Given Alight’s stronger consensus rating and higher possible upside, analysts plainly believe Alight is more favorable than Elastic.

Profitability

This table compares Elastic and Alight’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Elastic	-5.38%	-1.68%	-0.62%
Alight	-50.37%	6.26%	3.21%

Volatility & Risk

Elastic has a beta of 1.04, suggesting that its share price is 4% more volatile than the S&P 500. Comparatively, Alight has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500.

Summary

Elastic beats Alight on 9 of the 15 factors compared between the two stocks.

About Elastic

Elastic N.V., a data analytics company, delivers solutions designed to run in public or private clouds in multi-cloud environments. It primarily offers Elastic Stack, a set of software products that ingest and store data from various sources and formats, as well as performs search, analysis, and visualization on that data. The company's Elastic Stack product portfolio comprises Elasticsearch, a distributed, real-time search and analytics engine, and data store for various types of data, including textual, numerical, geospatial, structured, and unstructured; Kibana, a user interface, management, and configuration interface for the Elastic Stack; Elastic Agent that offers integrated host protection and central management services; Beats, a single-purpose data shippers for sending data from edge machines to Elasticsearch or Logstash; and Logstash, a data processing pipeline for ingesting data into Elasticsearch or other storage systems from a multitude of sources simultaneously. It also provides software solutions on the Elastic Stack that address cases, including search applications, workplace search, logs, metrics, application performance monitoring, synthetic monitoring, security information and event management (SIEM), endpoint security, extended detection and response, and cloud security. The company was incorporated in 2012 and is based in Amsterdam, the Netherlands.

About Alight

Alight, Inc. provides cloud-based integrated digital human capital and business solutions worldwide. The company operates through two segments, Employer Solutions and Professional Services. The Employer Solutions segment offers employee wellbeing, integrated benefits administration, healthcare navigation, financial wellbeing, leave of absence management, retiree healthcare and payroll; and operates AI-led capabilities software. The Professional Services segment offers consulting offerings, such as cloud advisory, deployment, and optimization services for cloud platforms. The company provides Alight Worklife, an intuitive, cloud-based employee engagement platform. Its solutions enable employees to enrich their health, wealth, and wellbeing that helps organizations achieve a high-performance culture. Alight, Inc. was founded in 2020 and is based in Lincolnshire, Illinois.