Upwork (NASDAQ:UPWK – Get Free Report) and Resources Connection (NASDAQ:RGP – Get Free Report) are both small-cap industrials companies, but which is the better business? We will compare the two companies based on the strength of their earnings, analyst recommendations, profitability, risk, valuation, institutional ownership and dividends.
Volatility & Risk
Upwork has a beta of 0.99, indicating that its share price is 1% less volatile than the S&P 500. Comparatively, Resources Connection has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500.
Valuation and Earnings
This table compares Upwork and Resources Connection”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Upwork | $787.78 million | 1.44 | $115.43 million | $0.81 | 11.31 |
| Resources Connection | $452.01 million | 0.33 | -$40.60 million | ($1.20) | -3.64 |
Upwork has higher revenue and earnings than Resources Connection. Resources Connection is trading at a lower price-to-earnings ratio than Upwork, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
77.7% of Upwork shares are held by institutional investors. Comparatively, 93.2% of Resources Connection shares are held by institutional investors. 4.9% of Upwork shares are held by company insiders. Comparatively, 7.9% of Resources Connection shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Upwork and Resources Connection’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Upwork | 13.81% | 17.92% | 8.54% |
| Resources Connection | -8.98% | -4.63% | -3.16% |
Analyst Recommendations
This is a summary of current recommendations and price targets for Upwork and Resources Connection, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Upwork | 1 | 9 | 3 | 0 | 2.15 |
| Resources Connection | 1 | 1 | 2 | 0 | 2.25 |
Upwork currently has a consensus price target of $15.50, indicating a potential upside of 69.21%. Resources Connection has a consensus price target of $7.00, indicating a potential upside of 60.18%. Given Upwork’s higher probable upside, research analysts clearly believe Upwork is more favorable than Resources Connection.
Summary
Upwork beats Resources Connection on 11 of the 14 factors compared between the two stocks.
About Upwork
Upwork Inc., together with its subsidiaries, operates a work marketplace that connects businesses with various independent professionals and agencies in the United States, India, the Philippines, and internationally. The company’s work marketplace provides access to talent with various skills across a range of categories, including administrative support, sales and marketing, design and creative, and customer service, as well as web, mobile, and software development. Its work marketplace also enables clients to streamline workflows, such as talent sourcing, outreach, and contracting. The company’s work marketplace offers access to various functionalities for remote engagements with talent, including communication and collaboration, ability to receive talent invoices through their work marketplace, and payment protection. Its marketplace offerings include Upwork Payroll and Upwork Enterprise, as well as managed and escrow services. The company was formerly known as Elance-oDesk, Inc. and changed its name to Upwork Inc. in May 2015. Upwork Inc. was incorporated in 2013 and is headquartered in San Francisco, California.
About Resources Connection
Resources Connection, Inc. provides consulting services to business customers under the Resources Global Professionals name in North America, Europe, and the Asia Pacific. The company offers services in the areas of transactions, including integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; and regulations, such as accounting regulations, internal audit and compliance, data privacy and security, healthcare compliance, and regulatory compliance. It provides transformations services comprising finance transformation, digital transformation, supply chain management, cloud migration, and data design and analytics. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.
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