Playtika (NASDAQ:PLTK) and Roblox (NYSE:RBLX) Critical Review

Roblox (NYSE:RBLX) and Playtika (NASDAQ:PLTK) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Valuation & Earnings

This table compares Roblox and Playtika”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Roblox	$4.89 billion	6.52	-$1.07 billion	($1.58)	-30.07
Playtika	$2.76 billion	0.51	-$206.40 million	($0.77)	-4.78

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

Profitability

This table compares Roblox and Playtika’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Roblox	-20.69%	-277.69%	-11.74%
Playtika	-10.54%	-67.46%	4.75%

Volatility and Risk

Roblox has a beta of 1.41, suggesting that its share price is 41% more volatile than the S&P 500. Comparatively, Playtika has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500.

Institutional and Insider Ownership

94.5% of Roblox shares are held by institutional investors. Comparatively, 11.9% of Playtika shares are held by institutional investors. 10.1% of Roblox shares are held by insiders. Comparatively, 5.7% of Playtika shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Roblox and Playtika, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Roblox	1	10	18	1	2.63
Playtika	1	4	2	0	2.14

Roblox presently has a consensus target price of $85.85, suggesting a potential upside of 80.70%. Playtika has a consensus target price of $4.00, suggesting a potential upside of 8.70%. Given Roblox’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Roblox is more favorable than Playtika.

Summary

Roblox beats Playtika on 9 of the 15 factors compared between the two stocks.

About Roblox

Roblox Corporation develops and operates an online entertainment platform in the United States and internationally. It offers Roblox Studio, a free toolset that allows developers and creators to build, publish, and operate 3D experiences, and other content; Roblox Client, an application that allows users to explore 3D experience; and Roblox Cloud, which provides services and infrastructure that power the platform. Roblox Corporation was incorporated in 2004 and is headquartered in San Mateo, California.

About Playtika

Playtika Holding Corp., together with its subsidiaries, develops mobile games in the United States, Europe, Middle East, Africa, Asia pacific, and internationally. The company owns a portfolio of casual and social casino-themed games. It distributes its games to the end customer through various web and mobile platforms and direct-to-consumer platforms. Playtika Holding Corp. was founded in 2010 and is headquartered in Herzliya Pituach, Israel. Playtika Holding Corp. is a subsidiary of Playtika Holding UK II Limited.