Reviewing News (NASDAQ:NWSA) & IMAX (NYSE:IMAX)

News (NASDAQ:NWSA) and IMAX (NYSE:IMAX) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.

Profitability

This table compares News and IMAX’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
News	5.18%	5.64%	3.09%
IMAX	6.98%	7.79%	3.42%

Earnings and Valuation

This table compares News and IMAX”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
News	$10.09 billion	1.65	$266.00 million	$0.86	34.22
IMAX	$352.21 million	4.32	$26.06 million	$0.47	60.18

News has higher revenue and earnings than IMAX. News is trading at a lower price-to-earnings ratio than IMAX, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

News has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500. Comparatively, IMAX has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.

Institutional and Insider Ownership

67.0% of News shares are held by institutional investors. Comparatively, 93.5% of IMAX shares are held by institutional investors. 13.6% of News shares are held by company insiders. Comparatively, 24.1% of IMAX shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings for News and IMAX, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
News	0	0	6	1	3.14
IMAX	0	1	8	2	3.09

News currently has a consensus price target of $39.20, indicating a potential upside of 33.20%. IMAX has a consensus price target of $31.70, indicating a potential upside of 12.07%. Given News’ stronger consensus rating and higher probable upside, equities research analysts plainly believe News is more favorable than IMAX.

Summary

IMAX beats News on 9 of the 15 factors compared between the two stocks.

About News

News Corporation, a media and information services company, creates and distributes authoritative and engaging content, and other products and services for consumers and businesses worldwide. It operates through six segments: Digital Real Estate Services, Subscription Video Services, Dow Jones, Book Publishing, News Media, and Other. The company distributes content and data products, including The Wall Street Journal, Barron’s, MarketWatch, Investor’s Business Daily, Factiva, Dow Jones Risk & Compliance, Dow Jones Newswires, and Dow Jones Energy through various media channels, such as newspapers, newswires, websites, mobile apps, newsletters, magazines, proprietary databases, live journalism, video, and podcasts. It also owns and operates Monday to Friday, Saturday and Sunday, weekly, and bi-weekly newspapers comprising The Australian, The Weekend Australian, The Daily Telegraph, The Sunday Telegraph, Herald Sun, Sunday Herald Sun, The Courier Mail, The Sunday Mail, The Advertiser, Sunday Mail, The Sun, The Sun on Sunday, The Times, The Sunday Times, and New York Post, as well as digital mastheads and other websites. In addition, the company publishes general fiction, nonfiction, children’s, and religious books; provides sports, entertainment, and news services to pay-TV and streaming subscribers, and other commercial licensees through satellite and internet distribution; and broadcasts rights to live sporting events. Further, it offers property and property-related advertising and services on its websites and mobile applications; digital real estate services; and financial services. News Corporation was founded in 2012 and is headquartered in New York, New York.

About IMAX

IMAX Corporation, together with its subsidiaries, operates as a technology platform for entertainment and events worldwide. The company operates in two segments, Content Solutions and Technology Products and Services. The company offers IMAX DMR, a proprietary technology that digitally remasters films and other content into IMAX formats for distribution to the IMAX network; IMAX Enhanced that provides end-to-end technology across streaming content and entertainment devices at home; and SSIMWAVE, an AI-driven video quality solutions for media and entertainment companies. It also offers preventative and emergency maintenance services and quality monitoring to the IMAX network; film post-production services; and IMAX film and digital cameras to content creators. In addition, the company engages in the distribution of large-format documentary films to institutional theaters, as well as live performances and interactive events with artists and creators; after-market sales of IMAX System parts and 3D glasses; sale or lease of IMAX theater systems; provision of management services to three other theaters, as well as production advice and technical assistance to documentary and Hollywood filmmakers; and rental of company’s proprietary 2D and 3D large-format film cameras. The company markets its theater systems through a direct sales force and marketing staff to science and natural history museums, zoos, aquaria, and other educational and cultural centers, as well as theme parks, private home theaters, tourist destination sites, fairs, and expositions. It offers its services under the IMAX, IMAX 3D, Experience It In IMAX, The IMAX Experience, DMR, Filmed For IMAXTM, IMAX Live, IMAX Enhanced, and SSIMWAVE. The company operates a network of IMAX systems comprising commercial multiplexes, commercial destinations, and institutional locations in 90 countries and territories. IMAX Corporation was founded in 1967 and is headquartered in Mississauga, Canada.