PubMatic (NASDAQ:PUBM – Get Free Report) and Locafy (NASDAQ:LCFY – Get Free Report) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.
Profitability
This table compares PubMatic and Locafy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| PubMatic | 5.96% | 6.12% | 2.58% |
| Locafy | -58.48% | -64.65% | -36.58% |
Analyst Recommendations
This is a summary of recent ratings for PubMatic and Locafy, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| PubMatic | 0 | 4 | 6 | 0 | 2.60 |
| Locafy | 0 | 0 | 0 | 0 | 0.00 |
Risk and Volatility
PubMatic has a beta of 1.54, meaning that its stock price is 54% more volatile than the S&P 500. Comparatively, Locafy has a beta of 1.59, meaning that its stock price is 59% more volatile than the S&P 500.
Institutional and Insider Ownership
64.3% of PubMatic shares are held by institutional investors. Comparatively, 0.0% of Locafy shares are held by institutional investors. 26.4% of PubMatic shares are held by company insiders. Comparatively, 28.7% of Locafy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares PubMatic and Locafy”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| PubMatic | $288.38 million | 2.03 | $8.88 million | $0.08 | 150.75 |
| Locafy | $3.85 million | 1.43 | -$1.96 million | ($1.23) | -3.24 |
PubMatic has higher revenue and earnings than Locafy. Locafy is trading at a lower price-to-earnings ratio than PubMatic, indicating that it is currently the more affordable of the two stocks.
Summary
PubMatic beats Locafy on 12 of the 14 factors compared between the two stocks.
About PubMatic
PubMatic, Inc., a technology company, engages in the provision of a cloud infrastructure platform that enables real-time programmatic advertising transactions for digital content creators, advertisers, agencies, agency trading desks, and demand side platforms worldwide. Its PubMatic SSP, a sell-side platform, used for the purchase and sale of digital advertising inventory for publishers and buyers. The company also provides solutions, including OpenWrap, a header bidding solution; Openwrap OTT, a prebid-powered unified bidding solution; Openwrap SDK, an enterprise-grade management tools and analytics; Connect, a solution that provides additional data and insights to publishers and buyers; Activate, which allows buyers to execute direct deals on its platform across publisher inventory; Convert, a commerce media solution; and Identity Hub, an ID management tool for publishers that leverages specialized technology?infrastructure?to simplify the complex alternative identifier marketplace. Its platform supports an array of ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top (OTT), connected television, and media. The company was incorporated in 2006 and is based in Redwood City, California.
About Locafy
Locafy Limited operates as a software-as-a-service company (SaaS) that specializes in search engine marketing in Australia, New Zealand, Europe, North America, and internationally. The company operates in three segments: Publishing, Direct Sales, and Reseller Sales. It focuses on commercializing its SaaS online publishing technology platform that comprises an integrated suite of solutions. The company also owns and operates several online directories and offers search engine optimization solutions, which include creation of proximity pages and proximity networks, local pages, and map pack booster. In addition, its platform publishes content to various devices that uses a web browser to display web content, as well as programmatically optimizes the published content for local search. The company offers its solutions directly to customers, as well as through digital agencies and search engine optimization freelancers. The company was formerly known as Moboom Limited and changed its name to Locafy Limited in January 2021. Locafy Limited was incorporated in 2009 and is based in Subiaco, Australia.
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