Financial Survey: Red Hat (RHT) vs. Jive Software (JIVE)

Red Hat (NYSE: RHT) and Jive Software (NASDAQ:JIVE) are both technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, valuation, analyst recommendations, dividends and profitability.

Earnings and Valuation

This table compares Red Hat and Jive Software’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Red Hat $2.41 billion 9.15 $253.70 million $1.84 67.74
Jive Software N/A N/A N/A ($0.11) N/A

Red Hat has higher revenue and earnings than Jive Software. Jive Software is trading at a lower price-to-earnings ratio than Red Hat, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

95.4% of Red Hat shares are owned by institutional investors. Comparatively, 65.4% of Jive Software shares are owned by institutional investors. 0.7% of Red Hat shares are owned by insiders. Comparatively, 10.7% of Jive Software shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Red Hat and Jive Software’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Red Hat 12.14% 26.23% 7.66%
Jive Software -3.25% -9.97% -2.90%

Analyst Recommendations

This is a summary of current ratings for Red Hat and Jive Software, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Red Hat 1 8 23 0 2.69
Jive Software 0 1 0 0 2.00

Red Hat currently has a consensus target price of $126.20, suggesting a potential upside of 1.24%. Jive Software has a consensus target price of $5.25, suggesting a potential upside of Infinity. Given Jive Software’s higher probable upside, analysts clearly believe Jive Software is more favorable than Red Hat.

Summary

Red Hat beats Jive Software on 9 of the 11 factors compared between the two stocks.

About Red Hat

Red Hat, Inc. (Red Hat) provides open source software solutions, using a community-powered approach to develop and offer operating system, virtualization, management, middleware, cloud, mobile and storage technologies. Red Hat operates through three geographical segments: the Americas, including the United States, Canada and Latin America; EMEA, including Europe, Middle East and Africa, and Asia Pacific. Its products and services include infrastructure-related offerings, application development-related and other technology offerings, and consulting, support and training services. Its infrastructure-related offerings include Red Hat Enterprise Linux, Red Hat Satellite and Red Hat Enterprise Virtualization. Its application development-related and other technology offerings include Red Hat JBoss Middleware, Red Hat cloud offerings, Red Hat Mobile and Red Hat Storage. Its consulting services include upgrade planning, platform migrations, solution integration and application development.

About Jive Software

Jive Software, Inc. is engaged in providing software sales and services. The Company’s products are sold on a subscription basis, deployable in on-premise, hosted and cloud instances and used for internal or external communities. Its traditional enterprise software product offerings are based on the Jive platform (the Jive Platform), which is a communication and collaboration hub. It sells its Jive Platform across two communities: internally for employees within the enterprise and externally for customers and partners outside the enterprise. It sells its products through a direct sales force, both domestically and internationally. The Jive Platform product offerings are delivered in two configurations, Jive Internal (Jive-n) for employee networks, and Jive External (Jive-x) as a platform for customer and partner communities. The Jive Platform integrates cloud and customer-built applications through published application programing interfaces and software development kits.

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