Alkami Technology (NASDAQ:ALKT – Get Free Report) and Fatpipe Inc/UT (NASDAQ:FATN – Get Free Report) are both small-cap technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, valuation, institutional ownership and earnings.
Insider and Institutional Ownership
55.0% of Alkami Technology shares are held by institutional investors. 17.1% of Alkami Technology shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk & Volatility
Alkami Technology has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500. Comparatively, Fatpipe Inc/UT has a beta of 2.88, indicating that its share price is 188% more volatile than the S&P 500.
Profitability
This table compares Alkami Technology and Fatpipe Inc/UT’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alkami Technology | -9.21% | -7.68% | -3.32% |
| Fatpipe Inc/UT | 26.87% | 28.42% | 20.22% |
Valuation and Earnings
This table compares Alkami Technology and Fatpipe Inc/UT”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Alkami Technology | $443.64 million | 3.53 | -$47.65 million | ($0.42) | -34.90 |
| Fatpipe Inc/UT | $19.21 million | 3.93 | $4.97 million | $0.39 | 13.69 |
Fatpipe Inc/UT has lower revenue, but higher earnings than Alkami Technology. Alkami Technology is trading at a lower price-to-earnings ratio than Fatpipe Inc/UT, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Alkami Technology and Fatpipe Inc/UT, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alkami Technology | 2 | 3 | 3 | 0 | 2.12 |
| Fatpipe Inc/UT | 1 | 0 | 3 | 0 | 2.50 |
Alkami Technology presently has a consensus target price of $20.80, indicating a potential upside of 41.88%. Fatpipe Inc/UT has a consensus target price of $9.33, indicating a potential upside of 74.78%. Given Fatpipe Inc/UT’s stronger consensus rating and higher probable upside, analysts clearly believe Fatpipe Inc/UT is more favorable than Alkami Technology.
Summary
Fatpipe Inc/UT beats Alkami Technology on 10 of the 13 factors compared between the two stocks.
About Alkami Technology
Alkami Technology, Inc. offers cloud-based digital banking solutions in the United States. The company's Alkami Platform allows financial institutions to onboard and engage new users, accelerate revenues, and enhance operational efficiency, with the support of a proprietary, cloud-based, and multi-tenant architecture. It serves community, regional, super-regional credit unions, and banks. The company was founded in 2009 and is headquartered in Plano, Texas.
About Fatpipe Inc/UT
FatPipe is a pioneer in enterprise-class, application-aware, secure software-defined wide area network (“SD-WAN”) solutions for organizations, including enterprises, communication service providers, security service providers, government organizations, and middle-market companies. Organizations, large and small, have become increasingly dependent on their information technology (“IT”) network infrastructure for data access and communications, and the critical importance of network reliability, extensibility, and durability has continued to grow as the volume of traffic across those networks expands. The management, monitoring, and security of an organization’s network has become increasingly complicated in an era of growing demands from remote work, increasing connectivity points, and disparate operations, while network integrity is challenged by ever more sophisticated cyber threats. These factors are conspiring to increase an organization’s reliance on its computer networks while simultaneously making the management and maintenance of those networks more costly and complex. We are dedicated to continually improving the way organizations connect, ensuring their networks are secure, reliable, and support their continued success. Our commitment lies in empowering our customers with a seamless and dependable connectivity infrastructure that safeguards their critical data and fosters business continuity. We further aim to ensure our customers have unparalleled insights into their network operations. Through our integrated suite of software solutions, we offer our customers a reliable and secure platform to support mission-critical applications running on cloud, hybrid cloud and on-premise networks. Our core offerings include SD-WAN, secure access service edge (“SASE”), and network monitoring service (“NMS”) software solutions, each of which is typically offered to our customers as a subscription service. These solutions address a broad set of network management needs and include an integrated set of capabilities to automate the complex requirements of network optimization. The market for these network services is large, global in nature and growing at attractive rates. The total global market for SD-WAN solutions and services, our core offering, was estimated by the Maia Research Report to grow from $4.5 billion in 2022 to over $17.6 billion in 2030. The Maia Research Report also projects the total market size for SASE software and platforms to expand from $6.4 billion in 2022 to $27.2 billion in 2030, and the total market for NMS to grow from $2.0 billion to $4.4 billion over the same period. Each of these individual markets are expected to grow at a compounded rate of between 10% and 20% through 2030, with SD-WAN’s projected growth rate to be approximately 18.5% through 2030. Our principal executive office is located in Salt Lake City, UT.
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