Formula Systems (1985) (NASDAQ:FORTY) and Earlyworks (NASDAQ:ELWS) Critical Analysis

Volatility and Risk

Earlyworks has a beta of 1.75, meaning that its stock price is 75% more volatile than the S&P 500. Comparatively, Formula Systems (1985) has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500.

Institutional and Insider Ownership

0.5% of Earlyworks shares are held by institutional investors. Comparatively, 34.8% of Formula Systems (1985) shares are held by institutional investors. 23.3% of Formula Systems (1985) shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Earlyworks and Formula Systems (1985)”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Earlyworks	$179.36 million	0.04	-$2.13 million	N/A	N/A
Formula Systems (1985)	$2.71 billion	0.54	$64.01 million	$4.82	19.71

Formula Systems (1985) has higher revenue and earnings than Earlyworks.

Profitability

This table compares Earlyworks and Formula Systems (1985)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Earlyworks	N/A	N/A	N/A
Formula Systems (1985)	2.78%	5.68%	2.70%

Summary

Formula Systems (1985) beats Earlyworks on 8 of the 9 factors compared between the two stocks.

About Earlyworks

Earlyworks Co., Ltd operates as a blockchain-based technology company in Japan. The company builds products, deliver services, and develop solutions based on its proprietary Grid Ledger System to leverage blockchain technology in various business settings, including advertisement tracking, online visitor management, and sales of non-fungible tokens. It also provides software and system development services; consulting and solution services; blockchain system solution planning; and proposal, design, and development planning services. The company serves the information technology, shipping, real estate, entertainment, cosmetics, and chemical products sectors. Earlyworks Co., Ltd was incorporated in 2018 and is based in Tokyo, Japan.

About Formula Systems (1985)

Formula Systems (1985) Ltd., through its subsidiaries, provides proprietary and non-proprietary software solutions, IT professional services, software product marketing and support, computer infrastructure and integration solutions, and learning and integration worldwide. The company offers computer and telecommunication infrastructure solutions; and sells and markets computers and peripheral equipment, and cloud based solutions and services relating to databases and big data. It also provides customer relations management, computer systems management infrastructures, web world content management, database and data warehouse mining, application integration, database and systems, data management, and software development tools; and application and professional training courses, and advanced professional studies. In addition, the company offers property and casualty insurance platforms, such as Sapiens, Sapiens CoreSuite, Sapiens IDITSuite, and IDIT Go; life, pension, and annuities platforms, including Sapiens, Sapiens CoreSuite, Sapiens UnderwritingPro, Sapiens ApplicationPro, Sapiens IllustrationPro, and Sapiens ConsolidationMaster; Sapiens Cloud-based DigitalSuite; data and analytics platform; and reinsurance software solutions comprising Sapiens ReinsuranceMaster, Sapiens ReinsurancePro, and Sapiens Reinsurance GO. Further, it provides Sapiens workers' compensation solutions; Sapiens medical professional liability solutions; financial and compliance solutions, such as Sapiens FinancialPro, Sapiens Financial GO, Sapiens StatementPro, Sapiens CheckPro, and Sapiens Reporting Tools; Sapiens Decision; and technology-based solutions. Additionally, it offers application development and business process integration platforms; vertical software solutions; strategic consulting and outsourcing services; and professional services in various areas, as well as develops on-premise payroll software. The company was incorporated in 1985 and is headquartered in Or Yehuda, Israel.