Critical Review: Criteo (CRTO) versus Marchex (MCHX)

Criteo (NASDAQ: CRTO) and Marchex (NASDAQ:MCHX) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their profitability, institutional ownership, valuation, risk, analyst recommendations, earnings and dividends.

Analyst Recommendations

This is a breakdown of recent recommendations for Criteo and Marchex, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Criteo 0 8 7 0 2.47
Marchex 0 1 0 0 2.00

Criteo presently has a consensus target price of $54.63, suggesting a potential upside of 56.80%. Marchex has a consensus target price of $3.00, suggesting a potential downside of 9.91%. Given Criteo’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Criteo is more favorable than Marchex.

Profitability

This table compares Criteo and Marchex’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Criteo 3.54% 14.20% 7.89%
Marchex -11.72% -7.76% -6.92%

Insider & Institutional Ownership

84.9% of Criteo shares are held by institutional investors. Comparatively, 49.5% of Marchex shares are held by institutional investors. 5.6% of Criteo shares are held by company insiders. Comparatively, 27.4% of Marchex shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Criteo has a beta of 2.64, meaning that its share price is 164% more volatile than the S&P 500. Comparatively, Marchex has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500.

Valuation and Earnings

This table compares Criteo and Marchex’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Criteo $1.80 billion 1.18 $82.27 million $1.16 30.03
Marchex $129.55 million 1.12 -$84.06 million ($0.27) -12.33

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

Summary

Criteo beats Marchex on 12 of the 13 factors compared between the two stocks.

Criteo Company Profile

Criteo SA is a France-based company specializing in digital performance marketing. Its solution consists of the Criteo Engine, the Company’s data assets, access to inventory, and its advertiser and publisher platforms. The Criteo Engine consists of various machine learning algorithms, such as prediction, recommendation, bidding and creative algorithms and the global hardware and software infrastructure. The Criteo Engine delivers advertisements through multiple marketing channels and formats, including display advertising banners, native advertising banners and marketing messages delivered to opt-in e-mail addresses. Advertisements are delivered on all devices and screens, including Web browsers on desktops and laptops, mobile Web browsers on smartphones and tablets, as well as mobile applications. It operates in approximately 90 countries through a network of over 30 international offices located in Europe, the Americas and the Asia-Pacific region. It operates through HookLogic Inc.

Marchex Company Profile

Marchex, Inc. is a mobile advertising analytics company. The Company offers products and services for enterprises that depend on consumer phone calls to drive sales. Its media analytics products can provide actionable intelligence on media channels advertisers use to acquire customers over the phone. Its Marchex Omnichannel Analytics Cloud helps marketers connect customer conversions driven from paid media channels, including search, display and video, social and sites, to phone calls made to a business. Its product offerings include Marchex Call Analytics, Marchex Search Analytics, Marchex Display and Video Analytics, Marchex Social Analytics, Marchex Call Marketplace and Local Leads. Its Local Leads platform is a white-labeled, full service advertising solution for small business resellers, such as Yellow Pages providers and vertical marketing service providers, to sell call advertising, search marketing and other lead generation products.

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