Critical Survey: Nutanix (NASDAQ:NTNX) versus Okta (NASDAQ:OKTA)

Nutanix (NASDAQ:NTNX) and Okta (NASDAQ:OKTA) are both large-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, institutional ownership, risk, valuation, profitability and analyst recommendations.

Insider and Institutional Ownership

85.3% of Nutanix shares are held by institutional investors. Comparatively, 86.6% of Okta shares are held by institutional investors. 6.8% of Nutanix shares are held by insiders. Comparatively, 7.0% of Okta shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Nutanix has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500. Comparatively, Okta has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500.

Profitability

This table compares Nutanix and Okta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nutanix	-3.54%	-12.28%	3.30%
Okta	-1.54%	0.47%	0.32%

Analyst Recommendations

This is a summary of current recommendations and price targets for Nutanix and Okta, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nutanix	0	3	12	0	2.80
Okta	1	15	16	0	2.47

Nutanix presently has a consensus price target of $79.50, indicating a potential upside of 10.80%. Okta has a consensus price target of $104.55, indicating a potential upside of 7.05%. Given Nutanix’s stronger consensus rating and higher probable upside, research analysts plainly believe Nutanix is more favorable than Okta.

Earnings and Valuation

This table compares Nutanix and Okta”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nutanix	$2.23 billion	8.63	-$124.78 million	($0.35)	-205.00
Okta	$2.53 billion	6.61	-$355.00 million	($0.35)	-279.03

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

Summary

Nutanix beats Okta on 7 of the 13 factors compared between the two stocks.

About Nutanix

Nutanix, Inc. engages in the provision of a cloud platform leveraging web-scale engineering and consumer-grade design. It operates through the following geographic segments: United States, Europe, the Middle East, Africa, Asia Pacific, and Other Americas. The firm also provides software solutions and cloud services to customers’ enterprise infrastructure. The company was founded by Dheeraj Pandey, Ajeet Singh, and Mohit Aron in 2009 and is headquartered in San Jose, CA.

About Okta

Okta, Inc. operates as an identity partner in the United States and internationally. The company offers Okta's suite of products and services used to manage and secure identities, such as Single Sign-On that enables users to access applications in the cloud or on-premises from various devices; Adaptive Multi-Factor Authentication provides a layer of security for cloud, mobile, web applications, and data; API Access Management enables organizations to secure APIs; Access Gateway enables organizations to extend Workforce Identity Cloud; and Okta Device Access enables end users to securely log in to devices with Okta credentials. It also provides Universal Directory, a cloud-based system of record to store and secure user, application, and device profiles for an organization; Lifecycle Management enables IT organizations or developers to manage a user's identity throughout its lifecycle; Okta Identity Governance provides identity access management and identity governance solutions; Advanced Server Access offers access management to secure cloud infrastructure; Okta Privileged Access enables organizations to reduce risk with unified access and governance management for on-premises and cloud resources; and Okta Workforce Identity Workflows. In addition, the company offers Universal Login, which allows customers to provide login experience across different applications and devices; and Attack Protection, a suite of security capabilities that protects customers from different types of malicious traffic. Further, it provides Adaptive Multi-Factor Authentication, Passwordless, Machine to Machine, Private Cloud, Organizations, Actions and Extensibility, and Enterprise Connections. The company sells its products directly to customers through sales force and channel partners. The company was formerly known as Saasure, Inc. Okta, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.