Reviewing Marchex (NASDAQ:MCHX) and Autoweb (AUTO)

Marchex (NASDAQ: MCHX) and Autoweb (NASDAQ:AUTO) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for Marchex and Autoweb, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Marchex 0 1 0 0 2.00
Autoweb 0 0 2 0 3.00

Marchex currently has a consensus target price of $3.00, suggesting a potential downside of 5.66%. Autoweb has a consensus target price of $12.00, suggesting a potential upside of 28.34%. Given Autoweb’s stronger consensus rating and higher probable upside, analysts clearly believe Autoweb is more favorable than Marchex.

Insider and Institutional Ownership

48.5% of Marchex shares are owned by institutional investors. Comparatively, 46.4% of Autoweb shares are owned by institutional investors. 27.4% of Marchex shares are owned by company insiders. Comparatively, 20.7% of Autoweb 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.

Profitability

This table compares Marchex and Autoweb’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Marchex -11.72% -7.76% -6.92%
Autoweb 1.51% 7.47% 5.68%

Earnings & Valuation

This table compares Marchex and Autoweb’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Marchex $129.55 million 1.07 -$84.06 million ($0.27) -11.78
Autoweb $156.68 million 0.78 $3.87 million $0.17 55.00

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

Volatility and Risk

Marchex has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500. Comparatively, Autoweb has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500.

Summary

Autoweb beats Marchex on 9 of the 13 factors compared between the two stocks.

About Marchex

Marchex, Inc. is a mobile advertising analytics company. The Company offers products and services for enterprises that depend on consumer phone calls to drive sales. Its media analytics products can provide actionable intelligence on media channels advertisers use to acquire customers over the phone. Its Marchex Omnichannel Analytics Cloud helps marketers connect customer conversions driven from paid media channels, including search, display and video, social and sites, to phone calls made to a business. Its product offerings include Marchex Call Analytics, Marchex Search Analytics, Marchex Display and Video Analytics, Marchex Social Analytics, Marchex Call Marketplace and Local Leads. Its Local Leads platform is a white-labeled, full service advertising solution for small business resellers, such as Yellow Pages providers and vertical marketing service providers, to sell call advertising, search marketing and other lead generation products.

About Autoweb

AutoWeb, Inc., formerly Autobytel Inc., is an automotive marketing services company that assists automotive retail dealers and automotive manufacturers market and sell new and used vehicles to consumers through the programs for online lead referrals, dealer marketing products and services, and online advertising programs and mobile products. The Company operates through providing automotive marketing services segment. Its consumer-facing automotive Websites, including Website Autobytel.com, provide consumers with information and tools to aid them with the automotive purchase decisions and ability to submit inquiries requesting dealers to contact the consumers regarding purchasing or leasing vehicles. Its AutoWeb pay-per-click advertising marketplace program uses technology to refer consumer traffic to dealers and manufacturer Websites.

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