Financial Survey: Pegasystems (NASDAQ:PEGA) vs. Brightcove (NASDAQ:BCOV)

Brightcove (NASDAQ:BCOV) and Pegasystems (NASDAQ:PEGA) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, institutional ownership, analyst recommendations, risk and profitability.

Earnings & Valuation

This table compares Brightcove and Pegasystems’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brightcove	$200.86 million	0.46	-$22.89 million	($0.22)	-9.50
Pegasystems	$1.43 billion	4.05	$67.81 million	$0.82	82.79

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

Institutional & Insider Ownership

80.1% of Brightcove shares are held by institutional investors. Comparatively, 46.9% of Pegasystems shares are held by institutional investors. 3.7% of Brightcove shares are held by insiders. Comparatively, 50.1% of Pegasystems shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Brightcove and Pegasystems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brightcove	0	1	1	0	2.50
Pegasystems	0	3	8	0	2.73

Brightcove currently has a consensus target price of $4.00, suggesting a potential upside of 91.39%. Pegasystems has a consensus target price of $82.60, suggesting a potential upside of 21.67%. Given Brightcove’s higher possible upside, equities analysts clearly believe Brightcove is more favorable than Pegasystems.

Volatility and Risk

Brightcove has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500. Comparatively, Pegasystems has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500.

Profitability

This table compares Brightcove and Pegasystems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brightcove	-4.28%	-8.86%	-3.88%
Pegasystems	8.72%	49.62%	11.56%

Summary

Pegasystems beats Brightcove on 12 of the 14 factors compared between the two stocks.

About Brightcove

Brightcove Inc. provides cloud-based streaming services the Americas, Europe, the Asia Pacific, Japan, India, and the Middle East. It offers Video Cloud, an online video streaming platform that enables its customers to publish, deliver, and distribute high-quality video to internet-connected devices. The company's solutions and products comprise Brightcove Marketing Studio, a video streaming solution; Brightcove Communications Studio for marketers and corporate communications professionals; Brightcove Media Studio, a solution for over-the-top (OTT) video services, media publishers, and leading broadcasters to monetize their media, live stream at scale, and nurture their audience lifecycle; Brightcove Audience Insights, a customer data platform for video streaming businesses; Zencoder, a cloud-based video encoding service; and Brightcove Beacon, a platform that enables its customers to launch premium OTT video streaming experiences, as well as Brightcove Marketplace. It also provides ad monetization; professional; customer success, support, and documentation; online and onsite training; and video.js and developer solutions. The company serves media companies, broadcasters, digital publishers, sports and entertainment companies, fashion and hospitality brands, faith-based institutions, retail and e-commerce businesses, and technology organizations, as well as government agencies, educational institutions, and non-profit organizations. Brightcove Inc. was incorporated in 2004 and is headquartered in Boston, Massachusetts.

About Pegasystems

Pegasystems Inc. develops, markets, licenses, hosts, and supports enterprise software in the United States, rest of the Americas, the United Kingdom, rest of Europe, the Middle East, Africa, and the Asia-Pacific. The company provides Pega Infinity, a software portfolio comprising of Pega Customer Decision Hub, a real-time AI-powered decision engine to enhance customer acquisition and experiences across inbound, outbound, and paid media channels; Pega Customer Service to anticipate customer needs, connect customers to people and systems, and automate customer interactions to evolve the customer service experience, as well as to allow enterprises to deliver interactions across channels and enhance employee productivity; and Pega Platform, an intelligent automation software for increasing efficiency of clients' processes and workflows. It also offers Situational Layer Cake that organizes logic into layers that map to the unique dimensions of a client's business, such as customer types, lines of business, geographies, etc.; Pega Express Methodology and low code that connects enterprise data and systems to customer experience channels; Pega Cloud that allows clients to develop, test, and deploy applications; Pega Catalyst, which helps clients to transform and prototype their customer journeys; Pega Academy, which offers instructor-led and online training to its employees, clients, and partners; and global service assurance and client support services. It primarily markets its software and services to financial services, healthcare, communications and media, government, insurance, manufacturing and high tech, and consumer services markets through a direct sales force, as well as partnerships with technology providers and application developers. Pegasystems Inc. was incorporated in 1983 and is headquartered in Cambridge, Massachusetts.