Financial Analysis: Rocket Fuel (FUEL) & Its Peers

Rocket Fuel (NASDAQ: FUEL) is one of 37 publicly-traded companies in the “Advertising & Marketing” industry, but how does it contrast to its peers? We will compare Rocket Fuel to related businesses based on the strength of its institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Institutional & Insider Ownership

40.4% of Rocket Fuel shares are held by institutional investors. Comparatively, 59.1% of shares of all “Advertising & Marketing” companies are held by institutional investors. 34.9% of Rocket Fuel shares are held by company insiders. Comparatively, 22.1% of shares of all “Advertising & Marketing” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk & Volatility

Rocket Fuel has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, Rocket Fuel’s peers have a beta of 1.05, indicating that their average share price is 5% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Rocket Fuel and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rocket Fuel 1 3 1 0 2.00
Rocket Fuel Competitors 45 421 876 16 2.64

Rocket Fuel presently has a consensus price target of $3.65, suggesting a potential upside of 40.38%. As a group, “Advertising & Marketing” companies have a potential upside of 11.12%. Given Rocket Fuel’s higher possible upside, equities research analysts clearly believe Rocket Fuel is more favorable than its peers.

Profitability

This table compares Rocket Fuel and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rocket Fuel -20.05% -120.35% -28.17%
Rocket Fuel Competitors -9.26% -10.15% -3.61%

Earnings & Valuation

This table compares Rocket Fuel and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Rocket Fuel $420.47 million -$16.55 million -1.73
Rocket Fuel Competitors $1.17 billion $156.81 million 19.33

Rocket Fuel’s peers have higher revenue and earnings than Rocket Fuel. Rocket Fuel is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Rocket Fuel peers beat Rocket Fuel on 10 of the 12 factors compared.

About Rocket Fuel

Rocket Fuel Inc. is a technology company, which offers a Programmatic Marketing Platform that is designed for helping marketers and their agencies to connect with consumers through digital media. The Company’s service offerings are organized around platforms, including Data Management Platform (DMP) and Demand Side Platform (DSP), which are used by customers themselves or integrating with other customer relationship management or marketing platforms, and together in various permutations as its Programmatic Marketing Platform. The integrated platform is designed to deliver and optimize media spend to engage, upsell and retarget consumers across addressable channels, including display, mobile and video, and across addressable devices, such as tablets, set top boxes, television and mobile phones. It offers Programmatic Marketing Platform as a managed service, which it operate on behalf of its customers, and as a self-service platform operated by its customers or their agencies directly.

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