Head to Head Review: Compass (NYSE:COMP) vs. VeriSign (NASDAQ:VRSN)

Compass (NYSE:COMP) and VeriSign (NASDAQ:VRSN) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, analyst recommendations, valuation, profitability, earnings and risk.

Institutional and Insider Ownership

67.1% of Compass shares are held by institutional investors. Comparatively, 92.9% of VeriSign shares are held by institutional investors. 6.3% of Compass shares are held by company insiders. Comparatively, 0.8% of VeriSign shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

Compass has a beta of 2.89, suggesting that its stock price is 189% more volatile than the S&P 500. Comparatively, VeriSign has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500.

Profitability

This table compares Compass and VeriSign’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Compass	-3.70%	-49.45%	-16.75%
VeriSign	55.74%	-45.59%	49.06%

Earnings & Valuation

This table compares Compass and VeriSign”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Compass	$5.35 billion	0.56	-$321.30 million	($0.40)	-14.63
VeriSign	$1.54 billion	12.71	$817.60 million	$8.60	23.72

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

Analyst Ratings

This is a summary of current ratings and price targets for Compass and VeriSign, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Compass	0	3	4	0	2.57
VeriSign	0	0	2	1	3.33

Compass currently has a consensus target price of $6.72, suggesting a potential upside of 14.90%. VeriSign has a consensus target price of $243.00, suggesting a potential upside of 19.15%. Given VeriSign’s stronger consensus rating and higher probable upside, analysts clearly believe VeriSign is more favorable than Compass.

Summary

VeriSign beats Compass on 11 of the 15 factors compared between the two stocks.

About Compass

Compass, Inc. provides real estate brokerage services in the United States. It operates a cloud-based platform that provides an integrated suite of software for customer relationship management, marketing, client service, operations, and other functionality in the real estate industry. The company offers mobile apps that allow agents to manage their business anytime and anywhere, as well as designs consumer-grade user interfaces, automated and simplified workflows for agent-client interactions, and insight-rich dashboards and reports. It also provides full-service title and escrow/settlement services to real estate agents' clients, real estate companies, and financial institutions relating to the closing of home purchases as well as the refinancing of home loans; and Compass Concierge, a program in which home sellers access to capital to front the cost of home improvement services. The company was formerly known as Urban Compass, Inc. and changed its name to Compass, Inc. in January 2021.Compass, Inc. was incorporated in 2012 and is headquartered in New York, New York.

About VeriSign

VeriSign, Inc., together with its subsidiaries, provides domain name registry services and internet infrastructure that enables internet navigation for various recognized domain names worldwide. The company enables the security, stability, and resiliency of internet infrastructure and services, including providing root zone maintainer services, operating two of thirteen internet root servers; and offering registration services and authoritative resolution for the .com and .net domains, which supports global e-commerce. It operates directory for .name and .cc; and back-end systems for .edu, domain names. VeriSign, Inc. was incorporated in 1995 and is headquartered in Reston, Virginia.