Contrasting Snap (NYSE:SNAP) & Vimeo (NASDAQ:VMEO)

Snap (NYSE:SNAP) and Vimeo (NASDAQ:VMEO) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Snap	-26.99%	-45.02%	-14.29%
Vimeo	5.28%	6.07%	3.64%

Institutional and Insider Ownership

47.5% of Snap shares are owned by institutional investors. Comparatively, 85.0% of Vimeo shares are owned by institutional investors. 22.7% of Snap shares are owned by company insiders. Comparatively, 7.9% of Vimeo shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Snap and Vimeo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Snap	2	15	9	0	2.27
Vimeo	0	1	0	0	2.00

Snap currently has a consensus price target of $14.67, suggesting a potential upside of 0.85%. Vimeo has a consensus price target of $4.00, suggesting a potential upside of 8.40%. Given Vimeo’s higher possible upside, analysts plainly believe Vimeo is more favorable than Snap.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Snap	$4.61 billion	5.21	-$1.32 billion	($0.81)	-17.96
Vimeo	$417.21 million	1.49	$22.03 million	$0.13	28.39

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

Risk and Volatility

Snap has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500. Comparatively, Vimeo has a beta of 2.04, meaning that its stock price is 104% more volatile than the S&P 500.

Summary

Vimeo beats Snap on 9 of the 14 factors compared between the two stocks.

About Snap

Snap Inc. operates as a technology company in North America, Europe, and internationally. The company offers Snapchat, a visual messaging application with various tabs, such as camera, visual messaging, snap map, stories, and spotlight that enable people to communicate visually through short videos and images. It also provides Spectacles, an eyewear product that connects with Snapchat and captures photos and video from a human perspective; and advertising products, including AR ads and Snap ads comprises a single image or video ads, collection ads, dynamic ads, story ads, and commercials. The company was formerly known as Snapchat, Inc. and changed its name to Snap Inc. in September 2016. Snap Inc. was founded in 2010 and is headquartered in Santa Monica, California.

About Vimeo

Vimeo, Inc., together with its subsidiaries, provides video software solutions worldwide. It provides the video tools through a software-as-a-service model, which enables its users to create, collaborate, and communicate with video on a single platform. The company also offers over-the-top OTT streaming and monetization services; AI-driven video creation and editing tools; and interactive and shoppable video tools. It serves large organizations, small businesses, creative professionals, marketers, and digital agencies. The company was founded in 2004 and is headquartered in New York, New York.