Reviewing MediaCo (NASDAQ:MDIA) & Stagwell (NASDAQ:STGW)

MediaCo (NASDAQ:MDIA) and Stagwell (NASDAQ:STGW) are both communication services companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.

Risk and Volatility

MediaCo has a beta of 0.13, meaning that its stock price is 87% less volatile than the S&P 500. Comparatively, Stagwell has a beta of 1.3, meaning that its stock price is 30% more volatile than the S&P 500.

Profitability

This table compares MediaCo and Stagwell’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MediaCo	N/A	N/A	N/A
Stagwell	0.53%	27.30%	4.77%

Valuation and Earnings

This table compares MediaCo and Stagwell”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MediaCo	$139.42 million	0.65	-$69.74 million	($0.83)	-1.30
Stagwell	$2.91 billion	0.75	$29.10 million	$0.06	149.67

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

Analyst Recommendations

This is a summary of recent ratings for MediaCo and Stagwell, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MediaCo	1	0	0	0	1.00
Stagwell	0	2	5	1	2.88

Stagwell has a consensus price target of $10.17, indicating a potential upside of 13.21%. Given Stagwell’s stronger consensus rating and higher probable upside, analysts plainly believe Stagwell is more favorable than MediaCo.

Institutional and Insider Ownership

64.0% of MediaCo shares are held by institutional investors. Comparatively, 35.6% of Stagwell shares are held by institutional investors. 9.8% of MediaCo shares are held by company insiders. Comparatively, 11.2% of Stagwell shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Stagwell beats MediaCo on 14 of the 15 factors compared between the two stocks.

About MediaCo

MediaCo Holding Inc. owns and operates radio stations in the United States. The company engages in the operation of WQHT-FM and WBLS-FM radio stations in the New York City area. It also offers digital advertising, and events, which includes sponsorships, ticket sales, licensing, and syndication services. MediaCo Holding Inc. was incorporated in 2019 and is headquartered in New York, New York.

About Stagwell

Stagwell Inc. provides digital transformation, performance media and data, consumer insights and strategy, and creativity and communications services. The company operates through three segments: Integrated Agencies Network, Brand Performance Network, and Communications Network. It designs and builds digital platforms and experiences that support the delivery of content, commerce, service, and sales; creates websites, mobile applications, back-end systems, content and data management systems, and other digital environments; designs and implements technology and data strategies; and develops software and related technology products, including artificial intelligence (AI)-enabled communications, research, and media technology, cookie-less data platforms for advance targeting and activation, software tools for e-commerce applications, specialty media solutions in the augmented reality space, and text messaging applications for consumer engagement. The company also provides audience analysis, and media buying and planning services; and strategic insights and guidance services that offers business content, product, communications, and media strategies. In addition, it offers strategy development, advertising creation, live events, immersive digital experiences, cross platform engagement, and social media content services; and leadership, investor and financial relations, social media, executive positioning and visibility, strategic communication, public relation, and public affair services. Further, the company provides Stagwell Marketing Cloud, a suite of software-as-a-service (SaaS) and data-as-a-service (DaaS) technology solutions, including research and insights, communications technology, advance media platform, and media studios; and technology-driven solutions for in-house marketers. Stagwell Inc. is headquartered in New York, New York.