Head-To-Head Comparison: PubMatic (NASDAQ:PUBM) and Dada Nexus (NASDAQ:DADA)

PubMatic (NASDAQ:PUBM) and Dada Nexus (NASDAQ:DADA) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Profitability

This table compares PubMatic and Dada Nexus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PubMatic	3.33%	3.29%	1.58%
Dada Nexus	-22.62%	-14.07%	-11.05%

Risk and Volatility

PubMatic has a beta of 1.52, meaning that its share price is 52% more volatile than the S&P 500. Comparatively, Dada Nexus has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500.

Institutional and Insider Ownership

64.3% of PubMatic shares are held by institutional investors. Comparatively, 59.3% of Dada Nexus shares are held by institutional investors. 2.9% of PubMatic shares are held by insiders. Comparatively, 8.5% of Dada Nexus shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares PubMatic and Dada Nexus’ top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PubMatic	$267.01 million	4.50	$8.88 million	$0.15	160.14
Dada Nexus	$1.49 billion	0.36	-$275.71 million	($1.31)	-1.53

PubMatic has higher earnings, but lower revenue than Dada Nexus. Dada Nexus is trading at a lower price-to-earnings ratio than PubMatic, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for PubMatic and Dada Nexus, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PubMatic	0	2	4	0	2.67
Dada Nexus	1	3	3	0	2.29

PubMatic presently has a consensus target price of $22.20, suggesting a potential downside of 7.58%. Dada Nexus has a consensus target price of $4.85, suggesting a potential upside of 142.71%. Given Dada Nexus’ higher probable upside, analysts plainly 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 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.

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.