Reviewing Rakuten (RKUNY) and The Competition

Rakuten (OTCMKTS:RKUNY) is one of 189 publicly-traded companies in the “Interactive Media & Services” industry, but how does it compare to its competitors? We will compare Rakuten to related companies based on the strength of its profitability, institutional ownership, risk, analyst recommendations, dividends, valuation and earnings.

Institutional and Insider Ownership

42.2% of shares of all “Interactive Media & Services” companies are held by institutional investors. 24.0% of shares of all “Interactive Media & Services” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Rakuten has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, Rakuten’s competitors have a beta of 1.89, meaning that their average stock price is 89% more volatile than the S&P 500.

Profitability

This table compares Rakuten and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rakuten	-2.48%	-5.09%	-0.22%
Rakuten Competitors	-157.00%	-15.48%	4.09%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Rakuten and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rakuten	0	1	0	0	2.00
Rakuten Competitors	1412	6002	11516	443	2.57

As a group, “Interactive Media & Services” companies have a potential upside of 31.27%. Given Rakuten’s competitors stronger consensus rating and higher probable upside, analysts clearly believe Rakuten has less favorable growth aspects than its competitors.

Earnings & Valuation

This table compares Rakuten and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Rakuten	$16.70 billion	-$1.19 billion	-20.64
Rakuten Competitors	$12.69 billion	$3.55 billion	8.50

Rakuten has higher revenue, but lower earnings than its competitors. Rakuten is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Summary

Rakuten competitors beat Rakuten on 9 of the 12 factors compared.

Rakuten Company Profile

Rakuten Group, Inc. is a Japan-based technology and internet services company founded in 1997 by Hiroshi Mikitani, who continues to serve as chairman and chief executive officer. The company operates a broad ecosystem of businesses spanning e-commerce, fintech, communications, digital content, travel, and other online services. Rakuten says its global ecosystem includes more than 70 businesses. Its principal businesses include Rakuten Ichiba, an online shopping marketplace; Rakuten Travel, a lodging and travel-booking service; and digital advertising and content offerings.