Analyzing Advantage Solutions (NASDAQ:ADV) and Trade Desk (NASDAQ:TTD)

Advantage Solutions (NASDAQ:ADV) and Trade Desk (NASDAQ:TTD) are both communication services companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, valuation, profitability, analyst recommendations, earnings and dividends.

Risk & Volatility

Advantage Solutions has a beta of 2.18, meaning that its stock price is 118% more volatile than the S&P 500. Comparatively, Trade Desk has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500.

Insider and Institutional Ownership

49.8% of Advantage Solutions shares are held by institutional investors. Comparatively, 67.8% of Trade Desk shares are held by institutional investors. 9.7% of Advantage Solutions shares are held by insiders. Comparatively, 11.4% of Trade Desk shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Advantage Solutions and Trade Desk, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Advantage Solutions	1	2	1	0	2.00
Trade Desk	10	25	4	0	1.85

Advantage Solutions currently has a consensus target price of $42.00, indicating a potential upside of 26.43%. Trade Desk has a consensus target price of $19.33, indicating a potential upside of 36.32%. Given Trade Desk’s higher probable upside, analysts clearly believe Trade Desk is more favorable than Advantage Solutions.

Profitability

This table compares Advantage Solutions and Trade Desk’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Advantage Solutions	-7.65%	-48.15%	-9.47%
Trade Desk	13.61%	16.09%	6.90%

Earnings and Valuation

This table compares Advantage Solutions and Trade Desk”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Advantage Solutions	$3.54 billion	0.12	-$227.74 million	($21.34)	-1.56
Trade Desk	$2.90 billion	2.30	$443.30 million	$0.84	16.88

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

Summary

Trade Desk beats Advantage Solutions on 11 of the 14 factors compared between the two stocks.

About Advantage Solutions

Advantage Solutions Inc. provides business solutions to consumer goods manufacturers and retailers in North America and internationally. It operates in two segments, Sales and Marketing. The Sales segment offers brand-centric services, such as headquarter relationship management; analytics, insights, and intelligence; and brand-centric merchandising services. This segment also provides retailer-centric services comprising retailer-centric merchandising and in-store media services. The Marketing segment offers brand-centric services, including shopper and consumer marketing, and brand experiential services; retailer-centric services, such as retail experiential and private label services; and digital marketing, and digital media and advertising services. The company was formerly known as Karman Holding Corp. and changed its name to Advantage Solutions Inc. in March 2016. The company was founded in 1987 and is headquartered in Irvine, California.

About Trade Desk

The Trade Desk, Inc. operates as a technology company in the United States and internationally. The company offers a self-service cloud-based platform that allows buyers to plan, manage, optimize, and measure data-driven digital advertising campaigns across various ad formats and channels, including video, display, audio, digital-out-of-home, native, and social on various devices, such as computers, mobile devices, televisions, and streaming devices. It provides data and other value-added services. The company serves advertising agencies, brands, and other service providers for advertisers. The Trade Desk, Inc. was incorporated in 2009 and is headquartered in Ventura, California.