Critical Review: InnerWorkings (INWK) and Its Peers

InnerWorkings (NASDAQ: INWK) is one of 120 public companies in the “Business services, not elsewhere classified” industry, but how does it contrast to its peers? We will compare InnerWorkings to related companies based on the strength of its risk, earnings, institutional ownership, dividends, valuation, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for InnerWorkings and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
InnerWorkings 0 0 3 0 3.00
InnerWorkings Competitors 761 3733 7170 301 2.59

InnerWorkings currently has a consensus target price of $14.00, suggesting a potential upside of 60.37%. As a group, “Business services, not elsewhere classified” companies have a potential upside of 1.09%. Given InnerWorkings’ stronger consensus rating and higher possible upside, equities analysts clearly believe InnerWorkings is more favorable than its peers.

Insider & Institutional Ownership

83.9% of InnerWorkings shares are owned by institutional investors. Comparatively, 64.5% of shares of all “Business services, not elsewhere classified” companies are owned by institutional investors. 6.4% of InnerWorkings shares are owned by insiders. Comparatively, 14.7% of shares of all “Business services, not elsewhere classified” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares InnerWorkings and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
InnerWorkings 1.67% 8.01% 3.59%
InnerWorkings Competitors 4.98% 3.80% 0.75%

Earnings and Valuation

This table compares InnerWorkings and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
InnerWorkings $1.14 billion $18.97 million 21.29
InnerWorkings Competitors $2.57 billion $356.09 million 8.80

InnerWorkings’ peers have higher revenue and earnings than InnerWorkings. InnerWorkings is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

InnerWorkings has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500. Comparatively, InnerWorkings’ peers have a beta of 0.68, meaning that their average share price is 32% less volatile than the S&P 500.

Summary

InnerWorkings beats its peers on 8 of the 13 factors compared.

About InnerWorkings

InnerWorkings, Inc. provides marketing execution solutions in North America and internationally. The company's software applications and databases create an integrated solution that stores, analyzes, and tracks the production capabilities of its supplier network, as well as detailed pricing data. It offers outsourced print management solutions that encompass the design, sourcing, and delivery of printed marketing materials, including direct mail, in-store signage, and marketing collateral; and outsourced solutions for the design, sourcing, and delivery of branded merchandise and product packaging. The company also assists clients with the management of events, promotions spending, and related procurement needs; and designs, sources, and installs point of sale displays, permanent retail fixtures, and overall store design, as well as offers on-site outsourced creative studio, digital marketing, and on-demand creative services. In addition, it provides fulfillment and logistics services, such as kitting and assembly, inventory management, and pre-sorting postage. Further, the company offers creative services comprising copywriting, graphics and Website design, identity work and marketing collateral development, and image and print-ready page processing and proofing capability services. It serves corporate clients in a range of industries, such as retail, financial services, hospitality, consumer packaged goods, non-profits, healthcare, pharmaceuticals, food and beverage, broadcasting and cable, and transportation. The company was founded in 2001 and is headquartered in Chicago, Illinois.

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