Financial Analysis: Zscaler (NASDAQ:ZS) & SpringBig (NASDAQ:SBIG)

Zscaler (NASDAQ:ZS) and SpringBig (NASDAQ:SBIG) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Profitability

This table compares Zscaler and SpringBig’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zscaler	-1.58%	-0.75%	-0.20%
SpringBig	-15.10%	N/A	-63.22%

Valuation and Earnings

This table compares Zscaler and SpringBig”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zscaler	$2.17 billion	14.05	-$57.71 million	($0.25)	-794.24
SpringBig	$28.37 million	0.11	-$10.23 million	($0.08)	-0.88

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

Institutional & Insider Ownership

46.5% of Zscaler shares are owned by institutional investors. Comparatively, 30.9% of SpringBig shares are owned by institutional investors. 18.1% of Zscaler shares are owned by company insiders. Comparatively, 41.0% of SpringBig shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Zscaler has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500. Comparatively, SpringBig has a beta of 2.88, suggesting that its stock price is 188% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Zscaler and SpringBig, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zscaler	0	11	23	0	2.68
SpringBig	0	0	1	0	3.00

Zscaler presently has a consensus target price of $226.56, suggesting a potential upside of 14.10%. SpringBig has a consensus target price of $1.00, suggesting a potential upside of 1,328.57%. Given SpringBig’s stronger consensus rating and higher possible upside, analysts clearly believe SpringBig is more favorable than Zscaler.

Summary

SpringBig beats Zscaler on 8 of the 14 factors compared between the two stocks.

About Zscaler

Zscaler, Inc. operates as a cloud security company worldwide. The company offers Zscaler Internet Access solution that provides users, workloads, IoT, and OT devices secure access to externally managed applications, including software-as-a-service (SaaS) applications and internet destinations; and Zscaler Private Access solution, which is designed to provide access to managed applications hosted internally in data centers, and private or public clouds. It also provides Zscaler Digital Experience that measures end-to-end user experience across business applications, as well as provides an easy-to-understand digital experience score for each user, application, and location within an enterprise. In addition, the company offers Posture Control solutions comprising Cloud Security Posture Management that identifies and remediates application misconfigurations in SaaS, infrastructure as a service, and PaaS to reduce risk and ensure compliance with industry and organizational benchmarks; Cloud Infrastructure Entitlement Management that detects and remediates excessive or unused cloud permissions and enforces least privileged access without disrupting productivity; Infrastructure as Code (IaC), which analyzes IaC templates to identify misconfigurations and other security issues prior to deployment to cloud infrastructure; and Vulnerability Scanning and Data Loss Prevention solutions. Its platform modules include Zscaler Central Authority, Zscaler Enforcement Node, and Zscaler Log Servers. The company serves customers in airlines and transportation, conglomerates, consumer goods and retail, financial services, healthcare, manufacturing, media and communications, public sector and education, technology, and telecommunications services industries. The company was formerly known as SafeChannel, Inc., and changed its name to Zscaler, Inc. in August 2008. Zscaler, Inc. was incorporated in 2007 and is headquartered in San Jose, California.

About SpringBig

SpringBig Holdings, Inc. develops and operates a software platform that provides marketing and customer engagement services to cannabis dispensaries and brands in the United States and Canada. Its platform offers customer loyalty and marketing automation solutions. The company was founded in 2016 and is headquartered in Boca Raton, Florida.