Analyzing SEA (NYSE:SE) and Snap (SNAP)

Snap (NYSE: SNAP) and SEA (NYSE:SE) are both mid-cap technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, valuation and risk.

Analyst Recommendations

This is a summary of recent recommendations for Snap and SEA, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Snap 15 19 10 0 1.89
SEA 0 0 6 0 3.00

Snap currently has a consensus price target of $17.48, suggesting a potential upside of 23.89%. SEA has a consensus price target of $18.67, suggesting a potential upside of 43.92%. Given SEA’s stronger consensus rating and higher probable upside, analysts clearly believe SEA is more favorable than Snap.

Insider & Institutional Ownership

18.9% of Snap shares are held by institutional investors. Comparatively, 68.7% of SEA shares are held by institutional investors. 0.2% of SEA 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.

Profitability

This table compares Snap and SEA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Snap -463.16% -107.36% -97.49%
SEA -141.10% N/A -48.73%

Earnings and Valuation

This table compares Snap and SEA’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Snap $404.48 million 42.01 -$514.64 million ($3.18) -4.44
SEA N/A N/A N/A N/A N/A

SEA has lower revenue, but higher earnings than Snap.

Summary

SEA beats Snap on 7 of the 9 factors compared between the two stocks.

About Snap

Snap Inc., formerly Snapchat, Inc., is a camera company. The Company’s flagship product, Snapchat, is a camera application that helps people to communicate through short videos and images known as a Snap. The Company offers three ways for people to make Snaps: the Snapchat application, Publishers Tools that help its partners to create Publisher Stories, and Spectacles, its sunglasses that make Snaps. Snaps are viewed primarily through the Snapchat application, but can also be embedded on the Web or on television in certain circumstances. Snapchat opens directly into the Camera, helping in creating a Snap and sending it to friends. The Company’s advertising products include Snap Ads and Sponsored Creative Tools, such as Sponsored Lenses and Sponsored Geofilters. As of December 31, 2016, on an average, 158 million people used Snapchat every day to Snap with family, watch Stories from friends, see events from around the world, and explore curated content from publishers.

About SEA

Sea Limited, formerly Garena Interactive Holding Limited, is an Internet company. The Company operates through three segments: digital entertainment, e-commerce and digital financial services. The Company has developed an integrated platform consisting of digital entertainment focused on online games, e-commerce, and digital financial services focused on e-wallet services. Its platforms include Garena, Shopee, and AirPay. Garena provides access to engaging mobile and personal computer (PC) online games, live streaming game play, as well as social features such as user chat and online forums. Shopee is an e-commerce marketplace where users come together to browse, shop and sell on-the-go, anytime, anywhere. AirPay App is the Company’s digital financial services business that provides e-wallet services to consumers through the AirPay App and to small businesses through the AirPay counter application.

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