Critical Analysis: Reddit (NYSE:RDDT) vs. Playtika (NASDAQ:PLTK)

Playtika (NASDAQ:PLTK) and Reddit (NYSE:RDDT) are both mid-cap consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

11.9% of Playtika shares are owned by institutional investors. 4.2% of Playtika shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Playtika and Reddit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Playtika	9.15%	-81.85%	9.16%
Reddit	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Playtika and Reddit, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Playtika	1	5	4	0	2.30
Reddit	1	6	8	1	2.56

Playtika presently has a consensus target price of $10.43, indicating a potential upside of 18.33%. Given Playtika’s higher possible upside, analysts plainly believe Playtika is more favorable than Reddit.

Valuation and Earnings

This table compares Playtika and Reddit’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Playtika	$2.57 billion	1.28	$235.00 million	$0.64	13.86
Reddit	$804.03 million	9.91	N/A	N/A	N/A

Playtika has higher revenue and earnings than Reddit.

Summary

Playtika beats Reddit on 6 of the 11 factors compared between the two stocks.

About Playtika

Playtika Holding Corp., together with its subsidiaries, develops mobile games in the United States, Europe, Middle East, Africa, Asia pacific, and internationally. The company owns a portfolio of casual and social casino-themed games. It distributes its games to the end customer through various web and mobile platforms and direct-to-consumer platforms. Playtika Holding Corp. was founded in 2010 and is headquartered in Herzliya Pituach, Israel. Playtika Holding Corp. is a subsidiary of Playtika Holding UK II Limited.

About Reddit

Reddit, Inc. operates a website that organizes digital communities. It organizes communities based on specific interests that enable users to engage in conversations by sharing experiences, submitting links, uploading images and videos, and replying to one another. The company was founded in 2005 and is headquartered in San Francisco, California.