Analyzing Spok (NASDAQ:SPOK) and SurgePays (NASDAQ:SURG)

Spok (NASDAQ:SPOK) and SurgePays (NASDAQ:SURG) are both small-cap communication services companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.

Valuation & Earnings

This table compares Spok and SurgePays”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Spok	$139.71 million	1.65	$15.88 million	$0.58	19.05
SurgePays	$56.96 million	0.14	-$36.07 million	($1.53)	-0.10

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

Volatility & Risk

Spok has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500. Comparatively, SurgePays has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.

Profitability

This table compares Spok and SurgePays’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Spok	9.00%	8.50%	6.08%
SurgePays	-47.89%	N/A	-274.37%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Spok and SurgePays, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Spok	0	2	0	0	2.00
SurgePays	1	1	1	0	2.00

Spok currently has a consensus target price of $14.00, indicating a potential upside of 26.70%. SurgePays has a consensus target price of $3.50, indicating a potential upside of 2,248.99%. Given SurgePays’ higher probable upside, analysts clearly believe SurgePays is more favorable than Spok.

Institutional & Insider Ownership

50.8% of Spok shares are held by institutional investors. Comparatively, 6.9% of SurgePays shares are held by institutional investors. 7.3% of Spok shares are held by insiders. Comparatively, 29.1% of SurgePays shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Spok beats SurgePays on 10 of the 13 factors compared between the two stocks.

About Spok

Spok Holdings, Inc., through its subsidiary, Spok, Inc., provides healthcare communication solutions in the United States, Europe, Canada, Australia, Asia, and the Middle East. The company's products and services enhance workflows for clinicians and support administrative compliance. It delivers clinical information to care teams when and where it matters to enhance patient outcomes; and provides GenA Pager, a one-way alphanumeric pager. The company offers subscriptions to one-way or two-way messaging services, as well as alphanumeric pagers that are configurable to support unencrypted or encrypted operation; and ancillary services, such as voicemail, and equipment loss or maintenance protection services, as well as sells devices to resellers who lease or resell them to their subscribers. Its Spok Care Connect suite products for contact centers, clinical alerting and notification, mobile communications and messaging, and public safety notifications. In addition, the company provides professional, software license updates, and product support services, as well as sells third-party equipment. It serves businesses, professionals, management personnel, medical personnel, field sales personnel and service forces, members of the construction industry and construction trades, real estate brokers and developers, sales and services organizations, specialty trade organizations, manufacturing organizations, and government agencies. The company was formerly known as USA Mobility, Inc. and changed its name to Spok Holdings, Inc. in July 2014. Spok Holdings, Inc. was founded in 1986 and is headquartered in Alexandria, Virginia.

About SurgePays

SurgePays, Inc., together with its subsidiaries, operates as a financial technology and telecom company in the United States. It operates through three segments: Mobile Virtual Network Operators, Comprehensive Platform Services, and Lead Generation. The company offers subsidized and non-subsidized mobile virtual network operators for internet connectivity through mobile broadband services to consumers; ACH banking relationships and fintech transactions platform to convenience stores; wireless top-up transactions and wireless product aggregation; and lead generation and case management solutions primarily to law firms in the mass tort industry, as well as call center activities. SurgePays, Inc. is headquartered in Bartlett, Tennessee.