Analyzing HUYA (NYSE:HUYA) and Direct Digital (NASDAQ:DRCT)

HUYA (NYSE:HUYAGet Rating) and Direct Digital (NASDAQ:DRCTGet Rating) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, profitability, risk and analyst recommendations.

Profitability

This table compares HUYA and Direct Digital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HUYA 5.09% 5.54% 4.39%
Direct Digital N/A N/A N/A

Analyst Recommendations

This is a summary of recent recommendations and price targets for HUYA and Direct Digital, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HUYA 4 1 4 0 2.00
Direct Digital 0 0 2 0 3.00

HUYA currently has a consensus price target of $9.08, indicating a potential upside of 119.85%. Direct Digital has a consensus price target of $6.00, indicating a potential upside of 160.87%. Given Direct Digital’s stronger consensus rating and higher possible upside, analysts plainly believe Direct Digital is more favorable than HUYA.

Institutional & Insider Ownership

27.2% of HUYA shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares HUYA 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
HUYA $1.78 billion 0.55 $91.57 million $0.37 11.16
Direct Digital $38.14 million 0.17 N/A N/A N/A

HUYA has higher revenue and earnings than Direct Digital.

Summary

HUYA beats Direct Digital on 7 of the 9 factors compared between the two stocks.

HUYA Company Profile (Get Rating)

HUYA Inc., through its subsidiaries, operates game live streaming platforms in the People's Republic of China. Its platforms enable broadcasters and viewers to interact during live streaming. The company's live streaming content also covers other entertainment content, such as talent shows, anime, outdoor activities, live chats, online theatre, and other genres. In addition, it operates Nimo TV, a game live streaming platform primarily in Southeast Asia, the Middle East, and Latin America. Further, the company provides online advertising, software development, internet value added, and cultural and creative services. As of December 31, 2020, its live streaming content covered approximately 4,000 games. The company was founded in 2014 and is headquartered in Guangzhou, the People's Republic of China. HUYA Inc. is a subsidiary of Tencent Holdings Limited.

Direct Digital Company Profile (Get Rating)

Direct Digital Holdings, Inc. operates as an end-to-end full-service programmatic advertising platform. The company's platform primarily focuses on providing advertising technology, data-driven campaign optimization, and other solutions to underserved and less efficient markets on both the buy- and sell-side of the digital advertising ecosystem. It serves various industry verticals, such as travel, healthcare, education, financial services, consumer products, etc. with focus on small- and mid-sized businesses. The company was founded in 2018 and is headquartered in Houston, Texas.

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