Dada Nexus (NASDAQ:DADA – Get Free Report) and PubMatic (NASDAQ:PUBM – Get Free Report) are both small-cap business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.
Risk & Volatility
Dada Nexus has a beta of 1.46, suggesting that its share price is 46% more volatile than the S&P 500. Comparatively, PubMatic has a beta of 1.52, suggesting that its share price is 52% more volatile than the S&P 500.
Earnings and Valuation
This table compares Dada Nexus and PubMatic’s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Dada Nexus | $1.49 billion | 0.38 | -$275.71 million | ($1.31) | -1.66 |
| PubMatic | $267.01 million | 4.39 | $8.88 million | $0.15 | 156.21 |
Insider & Institutional Ownership
59.3% of Dada Nexus shares are owned by institutional investors. Comparatively, 64.3% of PubMatic shares are owned by institutional investors. 8.5% of Dada Nexus shares are owned by insiders. Comparatively, 2.9% of PubMatic shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Dada Nexus and PubMatic’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Dada Nexus | -22.62% | -14.07% | -11.05% |
| PubMatic | 3.33% | 3.29% | 1.58% |
Analyst Ratings
This is a summary of current recommendations and price targets for Dada Nexus and PubMatic, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Dada Nexus | 1 | 3 | 3 | 0 | 2.29 |
| PubMatic | 0 | 2 | 4 | 0 | 2.67 |
Dada Nexus currently has a consensus target price of $4.85, suggesting a potential upside of 123.70%. PubMatic has a consensus target price of $22.20, suggesting a potential downside of 5.25%. Given Dada Nexus’ higher probable upside, equities analysts clearly believe Dada Nexus is more favorable than PubMatic.
Summary
PubMatic beats Dada Nexus on 11 of the 14 factors compared between the two stocks.
About Dada Nexus
Dada Nexus Limited operates a platform of local on-demand retail and delivery in the People's Republic of China. It operates Dada Now, a local on-demand delivery platform that provides intra-city delivery and last-mile delivery services on an on-demand basis to chain merchants, small- and medium-sized enterprise merchants, and individual senders; and JDDJ, a local on-demand retail platforms for consumers, retailers, and brand owners. The company was incorporated in 2014 and is headquartered in Shanghai, China.
About PubMatic
PubMatic, Inc., a technology company, engages in the provision of a cloud infrastructure platform that enables real-time programmatic advertising transactions for digital content creators, advertisers, agencies, agency trading desks, and demand side platforms worldwide. Its PubMatic SSP, a sell-side platform, used for the purchase and sale of digital advertising inventory for publishers and buyers. The company also provides solutions, including OpenWrap, a header bidding solution; Openwrap OTT, a prebid-powered unified bidding solution; Openwrap SDK, an enterprise-grade management tools and analytics; Connect, a solution that provides additional data and insights to publishers and buyers; Activate, which allows buyers to execute direct deals on its platform across publisher inventory; Convert, a commerce media solution; and Identity Hub, an ID management tool for publishers that leverages specialized technology?infrastructure?to simplify the complex alternative identifier marketplace. Its platform supports an array of ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top (OTT), connected television, and media. The company was incorporated in 2006 and is based in Redwood City, California.
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