Reviewing Gaia (NASDAQ:GAIA) and Townsquare Media (NYSE:TSQ)

Gaia (NASDAQ:GAIA) and Townsquare Media (NYSE:TSQ) are both small-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Institutional and Insider Ownership

40.5% of Gaia shares are owned by institutional investors. Comparatively, 71.7% of Townsquare Media shares are owned by institutional investors. 28.6% of Gaia shares are owned by company insiders. Comparatively, 29.2% of Townsquare Media shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Gaia and Townsquare Media’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gaia	-5.06%	-5.00%	-3.36%
Townsquare Media	7.93%	-56.87%	3.43%

Volatility & Risk

Gaia has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500. Comparatively, Townsquare Media has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Gaia and Townsquare Media, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gaia	1	0	2	1	2.75
Townsquare Media	0	1	2	0	2.67

Gaia presently has a consensus price target of $8.00, suggesting a potential upside of 29.66%. Townsquare Media has a consensus price target of $17.00, suggesting a potential upside of 171.35%. Given Townsquare Media’s higher probable upside, analysts plainly believe Townsquare Media is more favorable than Gaia.

Earnings & Valuation

This table compares Gaia and Townsquare Media”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gaia	$90.36 million	1.71	-$5.23 million	($0.19)	-32.47
Townsquare Media	$450.98 million	0.23	-$10.93 million	$2.02	3.10

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

Summary

Townsquare Media beats Gaia on 9 of the 14 factors compared between the two stocks.

About Gaia

Gaia, Inc. operates a digital video subscription service and online community for underserved member base in the United States, Canada, Australia, and internationally. The company has a digital content library with various titles in Spanish, German, and French languages available to its subscribers on internet connected devices. Its network includes Yoga channel, which provides access to streaming yoga, Eastern arts, and other movement based classes; Transformation channel that offers content in the areas of spiritual growth, personal development, and expanded consciousness; Alternative Healing channel, which features content focused on food and nutrition, holistic healing, alternative and integrative medicines, and longevity; and Seeking Truth channel that provides access to interviews and presentations in the ancient wisdom and metaphysics genre. The company was formerly known as Gaiam, Inc. and changed its name to Gaia, Inc. in July 2016. Gaia, Inc. was incorporated in 1988 and is headquartered in Louisville, Colorado.

About Townsquare Media

Townsquare Media, Inc. operates as a digital media and marketing solutions company in small and medium-sized businesses. It operates through three segments: Subscription Digital Marketing Solutions, Digital Advertising, and Broadcast Advertising. The Subscription Digital Marketing Solutions segment offers website design, creation, and development, as well as hosting services; and search engine optimization, online directory optimization, e-commerce solutions, online reputation monitoring, social media management, appointment scheduling, payment and invoice, customer management, and email and SMS marketing services. The Digital Advertising segment provides digital advertising on its owned and operated, digital programmatic advertising, and data analytics and management platform. The Broadcast Advertising segment engages in the sale of advertising on local radio stations to local, regional, and national spot advertisers, as well as national network advertisers. It also owns and operates live events, including concerts, expositions, and other experiential events; and operates local media under the WYRK.com, WJON.com, and NJ101.5.com brands, as well as national music under the XXLmag.com, TasteofCountry.com, UltimateClassicRock.com, and Loudwire.com brands. The company was formerly known as Regent Communications, Inc. and changed its name to Townsquare Media, Inc. in May 2010. Townsquare Media, Inc. is headquartered in Purchase, New York.