Reviewing Locafy (NASDAQ:LCFY) and Nextdoor (NYSE:KIND)

Locafy (NASDAQ:LCFY) and Nextdoor (NYSE:KIND) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, dividends and valuation.

Insider and Institutional Ownership

0.0% of Locafy shares are held by institutional investors. Comparatively, 35.7% of Nextdoor shares are held by institutional investors. 28.7% of Locafy shares are held by insiders. Comparatively, 46.0% of Nextdoor shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Locafy has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, Nextdoor has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.

Profitability

This table compares Locafy and Nextdoor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Locafy	-58.48%	-66.94%	-36.91%
Nextdoor	-53.23%	-19.42%	-16.78%

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Locafy	$3.85 million	2.66	-$1.96 million	($1.23)	-6.02
Nextdoor	$218.31 million	4.25	-$147.76 million	($0.32)	-7.59

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Locafy and Nextdoor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Locafy	0	0	0	0	0.00
Nextdoor	0	2	0	0	2.00

Nextdoor has a consensus price target of $2.75, suggesting a potential upside of 13.17%. Given Nextdoor’s stronger consensus rating and higher probable upside, analysts clearly believe Nextdoor is more favorable than Locafy.

Summary

Nextdoor beats Locafy on 10 of the 13 factors compared between the two stocks.

About Locafy

Locafy Limited operates as a software-as-a-service company (SaaS) that specializes in search engine marketing in Australia, New Zealand, Europe, North America, and internationally. The company operates in three segments: Publishing, Direct Sales, and Reseller Sales. It focuses on commercializing its SaaS online publishing technology platform that comprises an integrated suite of solutions. The company also owns and operates several online directories and offers search engine optimization solutions, which include creation of proximity pages and proximity networks, local pages, and map pack booster. In addition, its platform publishes content to various devices that uses a web browser to display web content, as well as programmatically optimizes the published content for local search. The company offers its solutions directly to customers, as well as through digital agencies and search engine optimization freelancers. The company was formerly known as Moboom Limited and changed its name to Locafy Limited in January 2021. Locafy Limited was incorporated in 2009 and is based in Subiaco, Australia.

About Nextdoor

Nextdoor Holdings, Inc. operates a neighborhood network that connects neighbors, businesses, and public services in the United States and internationally. The company enables neighbors and organizations to get information, give and get help, and build connections. It also offers advertising solutions, designs to generate value for businesses for connection and sales expansion. The company is headquartered in San Francisco, California.