Head-To-Head Survey: Square Enix (OTCMKTS:SQNXF) versus Reddit (NYSE:RDDT)

Reddit (NYSE:RDDT) and Square Enix (OTCMKTS:SQNXF) are both communication services companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, analyst recommendations, risk, profitability and earnings.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Reddit	31.35%	29.02%	26.32%
Square Enix	N/A	N/A	N/A

Volatility & Risk

Reddit has a beta of 2.02, suggesting that its stock price is 102% more volatile than the S&P 500. Comparatively, Square Enix has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500.

Valuation & Earnings

This table compares Reddit and Square Enix”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Reddit	$2.20 billion	13.47	$529.72 million	$4.30	35.86
Square Enix	$1.98 billion	3.33	$195.47 million	$0.75	24.33

Reddit has higher revenue and earnings than Square Enix. Square Enix is trading at a lower price-to-earnings ratio than Reddit, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Reddit and Square Enix, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reddit	0	11	18	2	2.71
Square Enix	0	0	0	1	4.00

Reddit presently has a consensus price target of $221.10, suggesting a potential upside of 43.40%. Given Reddit’s higher possible upside, equities research analysts clearly believe Reddit is more favorable than Square Enix.

Summary

Reddit beats Square Enix on 12 of the 13 factors compared between the two stocks.

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.

About Square Enix

Square Enix Holdings Co., Ltd. operates in the content and service businesses in Japan and internationally. It operates through Digital Entertainment Business, Amusement Business, Publishing Business, and Rights Property Business. The company plans, develops, sells, and manages digital entertainment content primarily in the form of computer games. It is also involved in the operation of amusement facilities; and planning, development, manufacture, sale, and rental of arcade game machines and related products for amusement facilities. In addition, the company publishes and licenses comic books, magazines, game-related books, periodicals, etc. Further, it plans, produces, distributes, and licenses secondary works; and offers content under the SQUARE ENIX PRODUCTS brand; and stuffed toys and utility goods under the SQEX TOYS brand. The company was incorporated in 1975 and is headquartered in Tokyo, Japan.