Analyzing Zuora (NYSE:ZUO) and Klaviyo (NYSE:KVYO)

Klaviyo (NYSE:KVYO) and Zuora (NYSE:ZUO) are both business services 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.

Profitability

This table compares Klaviyo and Zuora’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Klaviyo	-42.15%	-32.19%	-27.22%
Zuora	-10.60%	-12.54%	-2.29%

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Klaviyo	0	3	15	0	2.83
Zuora	0	3	4	0	2.57

Klaviyo currently has a consensus target price of $35.65, suggesting a potential upside of 1.27%. Zuora has a consensus target price of $11.86, suggesting a potential upside of 36.29%. Given Zuora’s higher probable upside, analysts clearly believe Zuora is more favorable than Klaviyo.

Institutional and Insider Ownership

45.4% of Klaviyo shares are held by institutional investors. Comparatively, 83.0% of Zuora shares are held by institutional investors. 53.2% of Klaviyo shares are held by company insiders. Comparatively, 8.6% of Zuora 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.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Klaviyo	$809.63 million	11.50	-$308.23 million	N/A	N/A
Zuora	$445.68 million	2.85	-$68.19 million	($0.43)	-20.23

Zuora has lower revenue, but higher earnings than Klaviyo.

Summary

Zuora beats Klaviyo on 6 of the 11 factors compared between the two stocks.

About Klaviyo

Klaviyo, Inc., a technology company, provides a software-as-a-service platform in the United States, other Americas, the Asia-Pacific, Europe, the Middle East, and Africa. The company offers Klaviyo, a cloud-native platform for data store, segmentation engine, campaigns and flows, and messaging infrastructure. It also provides email to send personalized marketing emails, including drag-and-drop email templates to edit and customize pre-built templates; email campaigns and automations with smart send time features, generative artificial intelligence for subject line creation, A/B testing tools, and consumer list segmentation; short message services to send targeted marketing text messages to consumers, as well as built-in contact cards to ensure that texts does not appear as random numbers; and push, a personalized push notification to engage with consumer. In addition, the company offers other applications, such as reviews, which collect product reviews; and customer data platform that allows to manage, deploy, transform, and sync data. It serves its products to entrepreneurs, small and medium-sized businesses to mid-market businesses, and enterprises. The was incorporated in 2012 and is headquartered in Boston, Massachusetts.

About Zuora

Zuora, Inc. provides a monetization suite for modern businesses to help companies launch and scale new services and operate dynamic customer-centric business models. The company offers Zuora Billing that allows customers to deploy various pricing and packaging strategies to monetize their recurring revenue streams, bill customers, calculate prorations when subscriptions change, and automate billing and payment operations; Zuora Revenue, a revenue recognition and automation solution that accounting teams use to manage their complex revenue streams; Zuora Payments to provide payment orchestration services for companies looking to operate globally; and Zephr, a digital subscriber experience platform that helps companies orchestrate dynamic experiences that increase conversion, reduce churn, and nurture ongoing subscriber relationships. It also provides Zuora Platform, an orchestration engine for all subscription data and processes; and other software. The company markets its products through its systems integrators, consultants, and ecosystem partners. Zuora, Inc. was incorporated in 2006 and is headquartered in Redwood City, California.