DoubleDown Interactive (NASDAQ:DDI) vs. Reading International (NASDAQ:RDI) Critical Survey

DoubleDown Interactive (NASDAQ:DDI) and Reading International (NASDAQ:RDI) are both small-cap communication services companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, analyst recommendations, valuation, risk and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for DoubleDown Interactive and Reading International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DoubleDown Interactive	0	2	2	0	2.50
Reading International	1	0	0	0	1.00

DoubleDown Interactive presently has a consensus price target of $18.33, suggesting a potential upside of 39.31%. Given DoubleDown Interactive’s stronger consensus rating and higher probable upside, research analysts clearly believe DoubleDown Interactive is more favorable than Reading International.

Valuation & Earnings

This table compares DoubleDown Interactive and Reading International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DoubleDown Interactive	$359.94 million	1.81	$102.50 million	$2.52	5.22
Reading International	$202.99 million	0.22	-$14.14 million	($0.55)	-3.47

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

Institutional & Insider Ownership

44.7% of Reading International shares are held by institutional investors. 32.4% of Reading International shares are held 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.

Risk and Volatility

DoubleDown Interactive has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, Reading International has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500.

Profitability

This table compares DoubleDown Interactive and Reading International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DoubleDown Interactive	32.91%	12.93%	11.81%
Reading International	-5.87%	N/A	-2.91%

Summary

DoubleDown Interactive beats Reading International on 12 of the 14 factors compared between the two stocks.

About DoubleDown Interactive

DoubleDown Interactive Co., Ltd. engages in the development and publishing of casual games and mobile applications in South Korea. It publishes digital gaming content on mobile and web platforms. The company offers DoubleDown Casino, DoubleDown Classic, DoubleDown Fort Knox, and cash me out games, as well as sells in-game virtual chips. Its games are primarily distributed, marketed, and promoted through third party platform providers. The company was formerly known as The8Games Co., Ltd. and changed its name to DoubleDown Interactive Co., Ltd. in December 2019. The company was incorporated in 2008 and is headquartered in Seoul, South Korea. DoubleDown Interactive Co., Ltd. is a subsidiary of DoubleU Games Co., Ltd.

About Reading International

Reading International, Inc., together with its subsidiaries, focuses on the ownership, development, and operation of entertainment and real property assets in the United States, Australia, and New Zealand. The company operates in two segments, Cinema Exhibition and Real Estate. The Cinema Exhibition segment operates multiplex cinemas. This segment operates its cinema exhibition businesses under the Reading Cinemas, Consolidated Theatres, Angelika Film Center, State Cinema by Angelika, Angelika Anywhere, Event Cinemas, and Rialto Cinemas brands. The Real Estate segment develops, rents, or licenses retail, commercial, and live theater assets. Reading International, Inc. was incorporated in 1999 and is headquartered in New York, New York.