Nextdoor (NYSE:KIND) vs. Meta Platforms (NASDAQ:META) Critical Review

Nextdoor (NYSE:KIND) and Meta Platforms (NASDAQ:META) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, profitability, earnings, dividends, analyst recommendations and valuation.

Valuation and Earnings

This table compares Nextdoor and Meta Platforms”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nextdoor	$237.61 million	3.88	-$147.76 million	($0.32)	-7.55
Meta Platforms	$134.90 billion	11.47	$39.10 billion	$21.23	28.86

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

Profitability

This table compares Nextdoor and Meta Platforms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nextdoor	-53.23%	-19.42%	-16.78%
Meta Platforms	35.55%	35.60%	23.66%

Institutional & Insider Ownership

35.7% of Nextdoor shares are held by institutional investors. Comparatively, 79.9% of Meta Platforms shares are held by institutional investors. 46.0% of Nextdoor shares are held by insiders. Comparatively, 13.7% of Meta Platforms 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.

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nextdoor	0	2	0	0	2.00
Meta Platforms	2	4	35	2	2.86

Nextdoor currently has a consensus price target of $2.75, suggesting a potential upside of 13.87%. Meta Platforms has a consensus price target of $650.05, suggesting a potential upside of 6.08%. Given Nextdoor’s higher possible upside, research analysts clearly believe Nextdoor is more favorable than Meta Platforms.

Risk & Volatility

Nextdoor has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, Meta Platforms has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Summary

Meta Platforms beats Nextdoor on 13 of the 15 factors compared between the two stocks.

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.

About Meta Platforms

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. It operates in two segments, Family of Apps and Reality Labs. The Family of Apps segment offers Facebook, which enables people to share, discuss, discover, and connect with interests; Instagram, a community for sharing photos, videos, and private messages, as well as feed, stories, reels, video, live, and shops; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact privately. The Reality Labs segment provides augmented and virtual reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. The company was incorporated in 2004 and is headquartered in Menlo Park, California