Alliance Entertainment (NASDAQ:AENT) and BuzzFeed (NASDAQ:BZFD) Critical Analysis

BuzzFeed (NASDAQ:BZFD) and Alliance Entertainment (NASDAQ:AENT) are both small-cap consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, earnings and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations and price targets for BuzzFeed and Alliance Entertainment, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BuzzFeed	1	1	0	0	1.50
Alliance Entertainment	0	2	2	0	2.50

BuzzFeed currently has a consensus target price of $1.00, suggesting a potential upside of 3.69%. Alliance Entertainment has a consensus target price of $10.67, suggesting a potential upside of 33.17%. Given Alliance Entertainment’s stronger consensus rating and higher probable upside, analysts plainly believe Alliance Entertainment is more favorable than BuzzFeed.

Profitability

This table compares BuzzFeed and Alliance Entertainment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BuzzFeed	0.06%	-38.20%	-16.42%
Alliance Entertainment	1.80%	21.87%	5.91%

Risk and Volatility

BuzzFeed has a beta of 3.42, meaning that its share price is 242% more volatile than the S&P 500. Comparatively, Alliance Entertainment has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.

Institutional & Insider Ownership

37.6% of BuzzFeed shares are held by institutional investors. Comparatively, 0.3% of Alliance Entertainment shares are held by institutional investors. 19.2% of BuzzFeed shares are held by insiders. Comparatively, 77.6% of Alliance Entertainment shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares BuzzFeed and Alliance Entertainment”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BuzzFeed	$189.89 million	0.19	-$10.10 million	N/A	N/A
Alliance Entertainment	$1.06 billion	0.38	$15.08 million	$0.39	20.54

Alliance Entertainment has higher revenue and earnings than BuzzFeed.

Summary

Alliance Entertainment beats BuzzFeed on 11 of the 13 factors compared between the two stocks.

About BuzzFeed

BuzzFeed, Inc., a digital media company, distributes content across owned and operated, as well as third-party platforms. The company offers BuzzFeed, a go-to authority for entertainment, pop culture, and Internet with articles, lists, quizzes, videos, and original series; BuzzFeed News, a pocket friendly newsroom; Tasty, a platform for food content; HuffPost, media platform for news, politics, opinion, entertainment, features, and lifestyle content. It also provides display, programmatic, and video advertising on its owned and operated sites and applications. BuzzFeed, Inc. is headquartered in New York, New York.

About Alliance Entertainment

Alliance Entertainment Holding Corporation operates as a wholesaler, distributor, and e-commerce provider for the entertainment industry worldwide. It offers vinyl records, video games, digital video discs, blu-rays, toys, compact discs, collectibles, and other entertainment and consumer products. The company also provides third party logistics products and services. It distributes its physical media, entertainment products, hardware, and accessories through multi-channel strategy. The company was founded in 1990 and is headquartered in Plantation, Florida.