Comparing Rakuten (OTCMKTS:RKUNY) and Akamai Technologies (NASDAQ:AKAM)

Akamai Technologies (NASDAQ:AKAM) and Rakuten (OTCMKTS:RKUNY) are both large-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, valuation, analyst recommendations, profitability, institutional ownership and risk.

Analyst Ratings

This is a breakdown of current ratings and price targets for Akamai Technologies and Rakuten, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Akamai Technologies	4	10	7	0	2.14
Rakuten	0	0	0	2	4.00

Akamai Technologies currently has a consensus target price of $97.50, indicating a potential downside of 10.07%. Given Akamai Technologies’ higher probable upside, equities analysts clearly believe Akamai Technologies is more favorable than Rakuten.

Valuation & Earnings

This table compares Akamai Technologies and Rakuten”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Akamai Technologies	$3.99 billion	3.91	$504.92 million	$3.41	31.79
Rakuten	$16.70 billion	0.73	-$1.19 billion	($0.54)	-10.37

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

Risk & Volatility

Akamai Technologies has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500. Comparatively, Rakuten has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500.

Insider & Institutional Ownership

94.3% of Akamai Technologies shares are owned by institutional investors. 2.0% of Akamai Technologies shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Akamai Technologies and Rakuten’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Akamai Technologies	12.26%	14.16%	6.33%
Rakuten	-7.13%	-15.36%	-0.67%

Summary

Akamai Technologies beats Rakuten on 11 of the 15 factors compared between the two stocks.

About Akamai Technologies

Akamai Technologies, Inc. provides cloud computing, security, and content delivery services in the United States and internationally. The company offers cloud solutions to keep infrastructure, websites, applications, application programming interfaces, and users safe from various cyberattacks and online threats while enhancing performance. It also provides web and mobile performance solutions to enable dynamic websites and applications; media delivery solutions, including video streaming and video player services, game and software delivery, broadcast operations, authoritative domain name system, resolution, and data and analytics; and cloud computing services, such as compute, storage, networking, database, and container management services to build, deploy, and secure applications and workloads. In addition, the company offers content delivery solutions; and an array of service and support to assist customers with integrating, configuring, optimizing, and managing its offerings. It sells its solutions through various channel partners. Akamai Technologies, Inc. was incorporated in 1998 and is headquartered in Cambridge, Massachusetts.

About Rakuten

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.