Hopto (OTCMKTS:HPTO) and American Software (NASDAQ:AMSWA) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, earnings, risk and institutional ownership.
Risk & Volatility
Hopto has a beta of 1.62, meaning that its stock price is 62% more volatile than the S&P 500. Comparatively, American Software has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.
Profitability
This table compares Hopto and American Software’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hopto | 12.29% | -49.00% | 28.42% |
| American Software | 6.51% | 7.76% | 5.49% |
Institutional and Insider Ownership
76.6% of American Software shares are owned by institutional investors. 15.3% of Hopto shares are owned by company insiders. Comparatively, 11.2% of American Software shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Hopto and American Software’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Hopto | $3.15 million | 1.25 | -$30,000.00 | N/A | N/A |
| American Software | $108.71 million | 4.37 | $6.80 million | $0.28 | 53.14 |
American Software has higher revenue and earnings than Hopto.
Analyst Recommendations
This is a breakdown of current ratings for Hopto and American Software, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hopto | 0 | 0 | 0 | 0 | N/A |
| American Software | 0 | 1 | 1 | 0 | 2.50 |
American Software has a consensus price target of $14.52, indicating a potential downside of 2.45%. Given American Software’s higher probable upside, analysts plainly believe American Software is more favorable than Hopto.
Summary
American Software beats Hopto on 7 of the 11 factors compared between the two stocks.
About Hopto
hopTo Inc., together with its subsidiaries, develops and sells application publishing software in the United States, Brazil, and internationally. Its application publishing software includes application virtualization software and cloud computing software for computer operating systems, including Windows, UNIX, and various Linux-based variants. The company offers its solutions under the GO-Global brand name. GO-Global is an application access solution that provides cross-platform remote access and Web-enabled access to existing software applications, as well as the deployment of secure and private cloud environments for use and/or resale by independent software vendors, corporate enterprises, governmental and educational institutions, and others. Its GO-Global software products include GO-Global for Windows that allows access to Windows-based applications from remote locations, and Internet and dial-up connections; GO-Global for UNIX, which allows access to UNIX and Linux-based applications from remote locations, and Internet connections; and GO-Global Client that allows remote application access from various local, remote, and mobile platforms. The company serves small to medium-sized companies, departments within large corporations, governmental and educational institutions, independent software vendors, and value-added resellers. hopTo Inc. has strategic relationships with KitASP, Elosoft Informatica Ltda, Alcatel-Lucent, GE Intelligent Platforms, GAD eG, and Information Delivery Systems, LLC. The company was formerly known as GraphOn Corporation and changed its name to hopTo Inc. in September 2013. hopTo Inc. was founded in 1996 and is headquartered in Concord, New Hampshire.
About American Software
American Software, Inc. develops, markets, and supports a portfolio of software and services worldwide. It operates in three segments: Supply Chain Management (SCM), Information Technology (IT) Consulting, and Other. The SCM segment provides supply chain management and retail planning solutions, including sales and operations planning, demand and inventory optimization, manufacturing planning and scheduling, supply optimization, retail allocation and merchandise planning, and transportation optimization solutions to streamline and optimize the forecasting, inventory, production scheduling, production, supply, allocation, distribution, and management of products between trading partners. This segment also offers cloud solutions for supply chain management, product lifecycle management, vendor quality, and vendor compliance and corporate social responsibility for brand retailers and manufacturers; and analytics and business intelligence solutions for the supply chain market. The IT Consulting segment offers IT staffing and consulting services, such as professional services/product management/project management, staff augmentation, and social media and analytic marketing, as well as cloud, collaboration, network, and security services for software enhancement, documentation, update, customer education, consulting, systems integration, maintenance, and other support services. The Other segment provides purchasing and materials management, customer order processing, financial, e-commerce, and traditional manufacturing solutions. The company markets its products through direct and indirect sales channels to retail, apparel, footwear, consumer packaged goods, chemicals, oil and gas, life sciences, telecommunications, consumer electronics, industrial products, and other manufacturing industries. American Software, Inc. was founded in 1970 and is headquartered in Atlanta, Georgia.
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