Reviewing iQIYI (NASDAQ:IQ) and LivePerson (NASDAQ:LPSN)

LivePerson (NASDAQ:LPSN) and iQIYI (NASDAQ:IQ) are both small-cap computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, risk, earnings, analyst recommendations, dividends and valuation.

Analyst Recommendations

This is a summary of current ratings and recommmendations for LivePerson and iQIYI, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LivePerson	1	1	0	0	1.50
iQIYI	1	1	2	0	2.25

iQIYI has a consensus target price of $2.55, suggesting a potential upside of 83.21%. Given iQIYI’s stronger consensus rating and higher possible upside, analysts plainly believe iQIYI is more favorable than LivePerson.

Valuation and Earnings

This table compares LivePerson and iQIYI”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LivePerson	$243.74 million	0.13	-$67.23 million	($13.05)	-0.20
iQIYI	$27.29 billion	0.05	-$29.50 million	($0.03)	-46.33

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

Profitability

This table compares LivePerson and iQIYI’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
LivePerson	-27.58%	N/A	-8.06%
iQIYI	-0.76%	-0.93%	-0.27%

Volatility & Risk

LivePerson has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500. Comparatively, iQIYI has a beta of 0.26, suggesting that its stock price is 74% less volatile than the S&P 500.

Institutional and Insider Ownership

79.8% of LivePerson shares are held by institutional investors. Comparatively, 52.7% of iQIYI shares are held by institutional investors. 2.0% of LivePerson shares are held by insiders. Comparatively, 57.8% of iQIYI shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

iQIYI beats LivePerson on 9 of the 14 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 iQIYI

iQIYI, Inc., together with its subsidiaries, provides online entertainment video services in the People's Republic of China. It offers various products and services, including online video, online games, online literature, animations, and other products. The company operates a platform that provides a collection of internet video content, such as professionally produced content licensed from professional content providers and self-produced content. It also offers membership, online advertising, content distribution, and live broadcasting services. In addition, the company operates iQIYI Show, a live broadcasting platform that enables users to follow their favorite hosts and shows in real time through live broadcasting; and iQIYI Lite that offers an easy and quick access to the personalized videos based on their user preferences. Further, it is involved in the talent agency and IP licensing activities, as well as engages in developing a video community app. The company was formerly known as Qiyi.com, Inc. and changed its name to iQIYI, Inc. in November 2017. iQIYI, Inc. was incorporated in 2009 and is headquartered in Beijing, China. iQIYI, Inc. is a subsidiary of Baidu, Inc.