Financial Contrast: Rakuten (RKUNY) versus The Competition

Rakuten (OTCMKTS:RKUNY) is one of 71 public companies in the “INTERNET SERVICES” industry, but how does it compare to its competitors? We will compare Rakuten to related businesses based on the strength of its valuation, dividends, earnings, risk, analyst recommendations, institutional ownership and profitability.

Risk and Volatility

Rakuten has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, Rakuten’s competitors have a beta of 2.60, suggesting that their average stock price is 160% more volatile than the S&P 500.

Institutional & Insider Ownership

42.1% of shares of all “INTERNET SERVICES” companies are owned by institutional investors. 23.3% of shares of all “INTERNET SERVICES” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Rakuten and its competitors revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Rakuten	$15.07 billion	-$1.07 billion	-8.81
Rakuten Competitors	$19.41 billion	$4.48 billion	12.91

Rakuten’s competitors have higher revenue and earnings than Rakuten. Rakuten is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Rakuten and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rakuten	-8.35%	-17.37%	-0.77%
Rakuten Competitors	-16.77%	-17.48%	0.69%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Rakuten and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rakuten	0	1	0	1	3.00
Rakuten Competitors	564	2449	5664	221	2.62

As a group, “INTERNET SERVICES” companies have a potential upside of 14.19%. Given Rakuten’s competitors higher probable upside, analysts plainly believe Rakuten has less favorable growth aspects than its competitors.

Summary

Rakuten competitors beat Rakuten on 9 of the 13 factors compared.

Rakuten Company Profile

Rakuten Group, Inc. provides services in e-commerce, fintech, digital content, and communications to various users in Japan and internationally. The company operates through three segments: Internet Services, FinTech, and Mobile. The Internet Services segment provides range of e-commerce sites, such as Rakuten Ichiba, an Internet shopping mall, online cash-back sites, travel booking sites, portal sites, and digital content sites. It also offers messaging services and sells advertising; and manages professional sport teams. The FinTech segment offers financial services over the internet related to banking and securities, credit cards, life insurance, general insurance, electronic payment business, crypto asset (virtual currency) spot transaction, etc. The Mobile segment provides communication services and technology, electricity supply, and digital content site services. The company was formerly known as Rakuten, Inc. and changed its name to Rakuten Group, Inc. in April 2021. Rakuten Group, Inc. was incorporated in 1997 and is headquartered in Setagaya, Japan.