Critical Comparison: Oracle (NYSE:ORCL) & EngageSmart (NYSE:ESMT)

Oracle (NYSE:ORCL) and EngageSmart (NYSE:ESMT) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, valuation, earnings, risk, analyst recommendations and profitability.

Valuation & Earnings

This table compares Oracle and EngageSmart’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oracle	$49.95 billion	6.86	$8.50 billion	$3.06	41.28
EngageSmart	$303.92 million	9.64	$20.59 million	$0.12	145.85

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Oracle and EngageSmart, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oracle	0	8	13	0	2.62
EngageSmart	0	3	4	1	2.75

Oracle currently has a consensus price target of $121.72, suggesting a potential downside of 3.64%. EngageSmart has a consensus price target of $25.11, suggesting a potential upside of 43.49%. Given EngageSmart’s stronger consensus rating and higher probable upside, analysts plainly believe EngageSmart is more favorable than Oracle.

Profitability

This table compares Oracle and EngageSmart’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oracle	17.02%	-470.73%	8.59%
EngageSmart	5.82%	3.30%	3.01%

Institutional & Insider Ownership

42.4% of Oracle shares are owned by institutional investors. Comparatively, 92.3% of EngageSmart shares are owned by institutional investors. 43.7% of Oracle shares are owned by insiders. Comparatively, 2.7% of EngageSmart shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

Oracle has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.Comparatively, EngageSmart has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500.

Summary

Oracle beats EngageSmart on 8 of the 15 factors compared between the two stocks.

About Oracle

Oracle Corporation offers products and services that address enterprise information technology environments worldwide. Its Oracle cloud software as a service offering include various cloud software applications, including Oracle Fusion cloud enterprise resource planning (ERP), Oracle Fusion cloud enterprise performance management, Oracle Fusion cloud supply chain and manufacturing management, Oracle Fusion cloud human capital management, Oracle Cerner healthcare, Oracle Advertising, and NetSuite applications suite, as well as Oracle Fusion Sales, Service, and Marketing. The company also offers cloud-based industry solutions for various industries; Oracle application licenses; and Oracle license support services. In addition, it provides cloud and license business' infrastructure technologies, such as the Oracle Database and MySQL Database; Java, a software development language; and middleware, including development tools and others. The company's cloud and license business' infrastructure technologies also comprise cloud-based compute, storage, and networking capabilities; and Oracle autonomous database, MySQL HeatWave, Internet-of-Things, digital assistant, and blockchain. Further, it provides hardware products and other hardware-related software offerings, including Oracle engineered systems, enterprise servers, storage solutions, industry-specific hardware, virtualization software, operating systems, management software, and related hardware services; and consulting and customer services. The company markets and sells its cloud, license, hardware, support, and services offerings directly to businesses in various industries, government agencies, and educational institutions, as well as through indirect channels. Oracle Corporation was founded in 1977 and is headquartered in Austin, Texas.

About EngageSmart

EngageSmart, Inc. provides vertically-tailored customer engagement and integrated payments solutions. The company operates through Enterprise Solutions and SMB Solutions segments. The Enterprise Solutions segment offers SaaS solutions to customer-client engagement through electronic billing and digital payments. The SMB Solutions segment provides end-to-end practice management solutions to health and wellness industry. It also offers SimplePractice, an end-to-end practice management and electronic health record platform that manages the practices, which enables virtual and in-person settings, schedule appointments, document cases, and billing and payment processing, as well as insurance claim processing; and InvoiceCloud, an electronic bill presentment and payment solution for government, utility, financial services customer digitize billing, client communications, and collections. In addition, the company provides HelathPay24, a patient engagement and payment platform for health systems, physician groups, dental practices, and medical billers, including patient self-pay collections; and DonorDrive, a fundraising platform for non-profits, healthcare organizations, and higher educational institutions, which produce virtual events, launch branded donation camping, and peer-to-peer fundraising. EngageSmart, Inc. was incorporated in 2018 and is headquartered in Braintree, Massachusetts.