NerdWallet (NASDAQ:NRDS) and QXO (NASDAQ:QXO) Critical Contrast

QXO (NASDAQ:QXO) and NerdWallet (NASDAQ:NRDS) are both business services companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Insider & Institutional Ownership

58.7% of QXO shares are owned by institutional investors. Comparatively, 38.8% of NerdWallet shares are owned by institutional investors. 51.3% of QXO shares are owned by insiders. Comparatively, 45.9% of NerdWallet shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent recommendations for QXO and NerdWallet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QXO	0	0	0	0	0.00
NerdWallet	0	1	4	0	2.80

NerdWallet has a consensus target price of $17.20, indicating a potential upside of 23.03%. Given NerdWallet’s stronger consensus rating and higher possible upside, analysts plainly believe NerdWallet is more favorable than QXO.

Volatility & Risk

QXO has a beta of 2.27, indicating that its stock price is 127% more volatile than the S&P 500. Comparatively, NerdWallet has a beta of 1.33, indicating that its stock price is 33% more volatile than the S&P 500.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QXO	$54.52 million	98.19	-$1.07 million	($9.12)	-1.43
NerdWallet	$599.40 million	1.71	-$11.80 million	($0.14)	-99.85

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

Profitability

This table compares QXO and NerdWallet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QXO	30.08%	1.58%	1.30%
NerdWallet	-1.65%	-2.90%	-2.45%

Summary

QXO beats NerdWallet on 9 of the 14 factors compared between the two stocks.

About QXO

QXO, Inc. operates as a business application, technology, and consulting company in North America. The company provides solutions for accounting and business management, financial reporting, enterprise resource planning, human capital management, warehouse management systems, customer relationship management, and business intelligence. It also offers value-added services that focuses on consulting and professional, specialized programming, training, and technical support services. In addition, the company provides information technology managed services, such as cybersecurity, application hosting, disaster recovery, business continuity, cloud, and other services; and data back-up, network maintenance, and upgrade services. It serves small and medium-sized businesses primarily in the manufacturing, distribution, and service industries. QXO, Inc. is headquartered in Greenwich, Connecticut.

About NerdWallet

NerdWallet, Inc. operates a digital platform that provides consumer-driven advice about personal finance by connecting individuals and small and mid-sized businesses with financial products providers in the United States, the United Kingdom, Australia, and Canada. Its platform offers guidance to consumers through educational content, tools and calculators, and product marketplaces, as well as through NerdWallet app for various financial products, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing, and student loans. The company was founded in 2009 and is based in San Francisco, California.