Head-To-Head Comparison: eGain (NASDAQ:EGAN) and Arteris (NASDAQ:AIP)

Arteris (NASDAQ:AIP) and eGain (NASDAQ:EGAN) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, dividends, analyst recommendations and valuation.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arteris	$57.72 million	13.28	-$33.64 million	($0.83)	-21.14
eGain	$88.43 million	3.08	$32.25 million	$1.23	8.20

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

Profitability

This table compares Arteris and eGain’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arteris	-52.25%	-8,546.17%	-32.05%
eGain	38.19%	10.05%	5.34%

Institutional and Insider Ownership

64.4% of Arteris shares are owned by institutional investors. Comparatively, 53.9% of eGain shares are owned by institutional investors. 29.1% of Arteris shares are owned by insiders. Comparatively, 38.7% of eGain shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Arteris and eGain, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arteris	1	1	4	0	2.50
eGain	0	2	2	0	2.50

Arteris currently has a consensus target price of $17.50, suggesting a potential downside of 0.28%. eGain has a consensus target price of $15.00, suggesting a potential upside of 48.81%. Given eGain’s higher possible upside, analysts clearly believe eGain is more favorable than Arteris.

Risk and Volatility

Arteris has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500. Comparatively, eGain has a beta of 0.81, meaning that its share price is 19% less volatile than the S&P 500.

Summary

eGain beats Arteris on 9 of the 13 factors compared between the two stocks.

About Arteris

Arteris, Inc. provides semiconductor interconnect intellectual property (IP) and System-on-Chip (Soc) Integration Automation software solutions (SIA) in the Americas, the Asia Pacific, Europe, and the Middle East. The company develops, licenses, and supports the on-chip interconnect fabric technology used in Soc designs and Network-on-Chip (NoC) interconnect IP. Its products include FlexNoC and FlexWay silicon-proven interconnect IP products; Ncore, a silicon-proven and cache coherent interconnect IP product that provides scalable, configurable, and area efficient characteristics; and CodaCache, a last-level cache semiconductor IP product. The company also offers SIA products comprising Magillem Connectivity that shortens and streamlines the SoC integration process; and Magillem Registers and CSRCompiler that addresses hardware-software integration challenges for SoCs. The company serves semiconductor manufacturers, original equipment manufacturers, hyperscale system houses, semiconductor design houses, and other producers of electronic systems. Arteris, Inc. was founded in 2003 and is headquartered in Campbell, California.

About eGain

eGain Corporation develops, licenses, implements, and supports customer service infrastructure software solutions in North America, Europe, the Middle East, Africa, and the Asia Pacific. It provides eGain Knowledge Hub, which helps businesses to centralize knowledge, policies, procedures, situational expertise, best-practices, while delivering guided, and personalized solutions to customers and agents; eGain Conversation Hub for digital-first, omnichannel interaction management within a modern, purpose-built desktop; and eGain Analytics Hub enables clients to measure, manage, and optimize omnichannel service operations and knowledge. The company also offers subscription services that provides customers with access to its software on a cloud-based platform; and professional services, such as consulting and implementation, training, and managed services. It serves customers in various industry sectors, including the financial services, telecommunications, retail, government, healthcare, and utilities. The company was incorporated in 1997 and is headquartered in Sunnyvale, California.