Financial Survey: Internet Initiative Japan (OTCMKTS:IIJIY) versus Dropbox (NASDAQ:DBX)

Dropbox (NASDAQ:DBX) and Internet Initiative Japan (OTCMKTS:IIJIY) are both mid-cap computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Insider & Institutional Ownership

94.8% of Dropbox shares are held by institutional investors. 30.0% of Dropbox shares are held by insiders. Comparatively, 6.7% of Internet Initiative Japan shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Dropbox and Internet Initiative Japan, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dropbox	1	2	1	0	2.00
Internet Initiative Japan	0	0	0	1	4.00

Dropbox presently has a consensus target price of $31.33, suggesting a potential upside of 19.91%. Given Dropbox’s higher possible upside, research analysts clearly believe Dropbox is more favorable than Internet Initiative Japan.

Profitability

This table compares Dropbox and Internet Initiative Japan’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dropbox	19.87%	-49.51%	19.48%
Internet Initiative Japan	6.76%	15.55%	7.08%

Volatility & Risk

Dropbox has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500. Comparatively, Internet Initiative Japan has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500.

Earnings and Valuation

This table compares Dropbox and Internet Initiative Japan”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dropbox	$2.55 billion	2.65	$452.30 million	$1.77	14.76
Internet Initiative Japan	$2.08 billion	1.51	$131.56 million	$1.69	20.25

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

Summary

Dropbox beats Internet Initiative Japan on 10 of the 15 factors compared between the two stocks.

About Dropbox

Dropbox, Inc. provides a content collaboration platform worldwide. The company's platform allows individuals, families, teams, and organizations to collaborate and sign up for free through its website or app, as well as upgrade to a paid subscription plan for premium features. It serves customers in professional services, technology, media, education, industrial, consumer and retail, and financial services industries. The company was formerly known as Evenflow, Inc. and changed its name to Dropbox, Inc. in October 2009. Dropbox, Inc. was incorporated in 2007 and is headquartered in San Francisco, California.

About Internet Initiative Japan

Internet Initiative Japan Inc. provides Internet connectivity, WAN, outsourcing, systems integration, and network-related equipment sales services in Japan. It operates through two segments, Network Services and Systems Integration Business, and ATM Operation Business. The company offers mobile communication and remote access/telework services; WAN/network services, including SDN, multi-cloud network, closed connection, internet VPN, SEIL, remote access, wireless LAN, and GIGA-school; leased line and broadband services; IIJ DNS platform, and domain name registration and maintenance services; IIJ access ID management, dial-up access, and IIJ IPv6 fiber access services; and security solutions for IIJ managed firewall, DDoS protection, and managed IPS/IDS services. It also provides cloud solutions, such as HaaS/IaaS, cloud storage, monitoring/operation, virtual desktop, Paas/Saas, solution for Microsoft and AWS, IoT/M2M, ID management and authentication, network, global, mobile, license, and specialized solutions, as well as IIJ cloud exchange and IIJ cloud integration solutions; integrated, network, mail, and web security, endpoint, security assessment/consulting, web and mail hosting, online storage, content delivery/CDN/CMS, and system integration; IoT services and solutions in the field of industrial, agriculture, energy, and IoT-oriented mobile communication; industry-specific solution; content delivery; and global/privacy products. In addition, the company offers IT outsourcing, IIJ consulting, cognitive factory, IIJ PC deployment support, IIJ PaaS solution, IIJ EMM utilization support, IIJ private cloud, network solutions, IIJ security audit, IIJ malware analysis, IIJ content management, cloud integration solution for Microsoft and AWS, Microsoft 365 transition support solution, data center service, and data center construction engineering solutions, as well as DX edge services. The company was incorporated in 1992 and is headquartered in Tokyo, Japan.