Magnite (NASDAQ:MGNI) & Grom Social Enterprises (NASDAQ:GROM) Critical Analysis

Magnite (NASDAQ:MGNI) and Grom Social Enterprises (NASDAQ:GROM) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Insider & Institutional Ownership

73.4% of Magnite shares are held by institutional investors. Comparatively, 15.9% of Grom Social Enterprises shares are held by institutional investors. 4.3% of Magnite shares are held by insiders. Comparatively, 0.0% of Grom Social Enterprises shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

Magnite has a beta of 2.52, indicating that its share price is 152% more volatile than the S&P 500. Comparatively, Grom Social Enterprises has a beta of 1.82, indicating that its share price is 82% more volatile than the S&P 500.

Valuation & Earnings

This table compares Magnite and Grom Social Enterprises”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magnite	$661.13 million	3.76	-$159.18 million	$0.06	294.83
Grom Social Enterprises	$4.04 million	0.00	-$12.53 million	($11.67)	0.00

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

Profitability

This table compares Magnite and Grom Social Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magnite	2.62%	4.64%	1.25%
Grom Social Enterprises	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent recommendations and price targets for Magnite and Grom Social Enterprises, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magnite	0	1	12	0	2.92
Grom Social Enterprises	0	0	0	0	0.00

Magnite presently has a consensus target price of $18.35, suggesting a potential upside of 3.71%. Given Magnite’s stronger consensus rating and higher possible upside, research analysts clearly believe Magnite is more favorable than Grom Social Enterprises.

Summary

Magnite beats Grom Social Enterprises on 13 of the 14 factors compared between the two stocks.

About Magnite

Magnite, Inc., together with its subsidiaries, operates an independent omni-channel sell-side advertising platform in the United States and internationally. The company’s platform offers applications and services for sellers of digital advertising inventory or publishers that own and operate CTV channels, applications, websites, and other digital media properties to manage and monetize their inventory; and applications and services for buyers, including advertisers, agencies, agency trading desks, and demand side platforms to buy digital advertising inventory, as well as an independent marketplace that connects buyers and sellers. It markets its solutions through sales teams that operate from various locations. The company was formerly known as The Rubicon Project, Inc. and changed name to Magnite, Inc. in July 2020. Magnite, Inc. was incorporated in 2007 and is headquartered in New York, New York.

About Grom Social Enterprises

Grom Social Enterprises, Inc., through its subsidiaries, operates as a media, technology, and entertainment company in the United States and Philippines. It operates through three segments: Animation, Original Content, and Social and Technology. The company operates a social media network for children under the age of 13 years. It also produces animated films and televisions series; and provides web filtering services to schools and government agencies, as well as acquires, develops, and builds commercial potential of kids and family entertainment properties and associated business opportunities. Grom Social Enterprises, Inc. was founded in 2012 and is headquartered in Boca Raton, Florida.