Electronic Arts (NASDAQ: EA) and YuMe (NYSE:YUME) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, dividends, valuation, risk, institutional ownership, analyst recommendations and earnings.
Risk and Volatility
Electronic Arts has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, YuMe has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.
This is a breakdown of current ratings and price targets for Electronic Arts and YuMe, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Electronic Arts presently has a consensus price target of $123.51, suggesting a potential upside of 19.47%. Given Electronic Arts’ stronger consensus rating and higher probable upside, analysts plainly believe Electronic Arts is more favorable than YuMe.
YuMe pays an annual dividend of $0.12 per share and has a dividend yield of 3.4%. Electronic Arts does not pay a dividend. YuMe pays out 120.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Insider & Institutional Ownership
93.8% of Electronic Arts shares are held by institutional investors. Comparatively, 48.0% of YuMe shares are held by institutional investors. 2.6% of Electronic Arts shares are held by company insiders. Comparatively, 29.3% of YuMe shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Valuation & Earnings
This table compares Electronic Arts and YuMe’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Electronic Arts||$4.85 billion||6.57||$967.00 million||$3.80||27.21|
|YuMe||$160.41 million||0.77||-$7.72 million||$0.10||35.20|
Electronic Arts has higher revenue and earnings than YuMe. Electronic Arts is trading at a lower price-to-earnings ratio than YuMe, indicating that it is currently the more affordable of the two stocks.
This table compares Electronic Arts and YuMe’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Electronic Arts beats YuMe on 13 of the 16 factors compared between the two stocks.
Electronic Arts Company Profile
Electronic Arts Inc. develops, markets, publishes and distributes games, content and services that can be played by consumers on a range of platforms, which include consoles, personal computers (PCs), mobile phones and tablets. The Company’s games and services are based on a portfolio of intellectual property that includes established brands, such as FIFA, Madden NFL, Star Wars, Battlefield, the Sims and Need for Speed. The Company markets and sells its games and services through retail channels and through digital distribution channels. The Company’s PC games and additional content can be downloaded directly through its Origin online platform, as well as through third-party online download stores. Its mobile, tablet and PC free-to-download games and additional content are available through third-party application storefronts, such as the Apple Application Store and Google Play.
YuMe Company Profile
YuMe, Inc. (YuMe) is an independent provider of multi-screen video advertising technology, connecting brand advertisers, digital media property owners and consumers of video content across a range of Internet-connected devices. The Company operating segments include Domestic and International. The Company offers advertising customers end-to-end marketing solutions by combining data-driven technologies with deep insight into audience behavior. The Company also offers demand-side platform (DSP), called YuMe for Advertisers, to find relevant audiences and deliver targeted advertising, and a supply-side platform (SSP), called YuMe for Publishers (YFP 5.0), which helps aggregate audiences, define audience characteristics and offer monetization opportunities for digital media property owners. Its technologies serve the specific needs of brand advertisers and enable them to find and target brand-receptive audiences across a range of Internet connected devices and digital media properties.
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