Liberty Global (NASDAQ:LBTYB – Get Free Report) and Direct Digital (NASDAQ:DRCT – Get Free Report) are both communication services companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.
Risk and Volatility
Liberty Global has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500. Comparatively, Direct Digital has a beta of 5.49, suggesting that its share price is 449% more volatile than the S&P 500.
Earnings & Valuation
This table compares Liberty Global and Direct Digital”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Liberty Global | $4.88 billion | 0.87 | -$7.14 billion | ($7.39) | -1.68 |
| Direct Digital | $30.91 million | 0.00 | -$18.95 million | ($156.85) | -0.00 |
Direct Digital has lower revenue, but higher earnings than Liberty Global. Liberty Global is trading at a lower price-to-earnings ratio than Direct Digital, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Liberty Global and Direct Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Liberty Global | -44.40% | -25.14% | -9.55% |
| Direct Digital | -74.38% | N/A | -68.48% |
Institutional & Insider Ownership
0.5% of Liberty Global shares are owned by institutional investors. Comparatively, 4.0% of Direct Digital shares are owned by institutional investors. 6.5% of Liberty Global shares are owned by company insiders. Comparatively, 25.6% of Direct Digital shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Analyst Recommendations
This is a summary of current ratings and price targets for Liberty Global and Direct Digital, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Liberty Global | 1 | 0 | 0 | 0 | 1.00 |
| Direct Digital | 1 | 0 | 0 | 0 | 1.00 |
Summary
Direct Digital beats Liberty Global on 6 of the 11 factors compared between the two stocks.
About Liberty Global
Liberty Global is an international telecommunications company that provides broadband internet, video, mobile and fixed-line voice services through operating businesses and joint ventures. Its consumer brands and services serve residential and business customers in several European markets. The company’s portfolio includes interests in Virgin Media O2 in the United Kingdom and VodafoneZiggo in the Netherlands, as well as operating businesses such as Telenet in Belgium. Its structure combines wholly owned businesses with partnerships alongside other telecommunications companies.
About Direct Digital
Direct Digital Holdings, Inc. is an advertising technology company that provides digital marketing and programmatic advertising solutions to advertisers, agencies, publishers and media owners. The company helps clients plan, execute and optimize campaigns across channels such as display, mobile, connected television, audio and other digital formats. Direct Digital operates through two primary businesses. Huddled Masses Media is its buy-side platform, providing campaign management, audience targeting, media buying and optimization services for advertisers and agencies.
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