Critical Survey: Travelzoo (NASDAQ:TZOO) vs. ZoomInfo Technologies (NASDAQ:ZI)

ZoomInfo Technologies (NASDAQ:ZI) and Travelzoo (NASDAQ:TZOO) are both small-cap communication services companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, earnings, valuation, profitability and analyst recommendations.

Profitability

This table compares ZoomInfo Technologies and Travelzoo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ZoomInfo Technologies	0.74%	12.05%	3.46%
Travelzoo	0.51%	-9.35%	1.00%

Volatility and Risk

ZoomInfo Technologies has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500. Comparatively, Travelzoo has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.

Earnings & Valuation

This table compares ZoomInfo Technologies and Travelzoo”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ZoomInfo Technologies	$1.21 billion	1.06	$107.30 million	$0.12	31.25
Travelzoo	$92.15 million	0.61	$4.70 million	$0.03	182.67

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

Analyst Recommendations

This is a summary of recent recommendations and price targets for ZoomInfo Technologies and Travelzoo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ZoomInfo Technologies	2	2	1	0	1.80
Travelzoo	2	0	2	0	2.00

ZoomInfo Technologies currently has a consensus target price of $5.19, indicating a potential upside of 38.33%. Travelzoo has a consensus target price of $13.83, indicating a potential upside of 152.43%. Given Travelzoo’s stronger consensus rating and higher probable upside, analysts clearly believe Travelzoo is more favorable than ZoomInfo Technologies.

Insider & Institutional Ownership

95.5% of ZoomInfo Technologies shares are owned by institutional investors. Comparatively, 27.4% of Travelzoo shares are owned by institutional investors. 9.0% of ZoomInfo Technologies shares are owned by company insiders. Comparatively, 45.3% of Travelzoo shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

ZoomInfo Technologies beats Travelzoo on 8 of the 14 factors compared between the two stocks.

About ZoomInfo Technologies

ZoomInfo Technologies Inc., together with its subsidiaries, provides go-to-market intelligence and engagement platform for sales and marketing teams in the United States and internationally. The company's cloud-based platform provides information on organizations and professionals to help users identify target customers and decision makers, obtain continually updated predictive lead and company scoring, monitor buying signals and other attributes of target companies, craft messages, engage through automated sales tools, and track progress through the deal cycle. It serves enterprises, mid-market companies, and down to small businesses that operate in various industry, including software, business services, manufacturing, telecommunications, financial services, media and internet, transportation, education, hospitality, and real estate. The company was founded in 2007 and is headquartered in Vancouver, Washington.

About Travelzoo

Travelzoo, together with its subsidiaries, operates as an Internet media company that provides travel, entertainment, and local experiences worldwide. It operates in four segments: Travelzoo North America, Travelzoo Europe, Jack's Flight Club, and New Initiatives. The company offers Travelzoo website, Travelzoo Top 20 email newsletters, Standalone email newsletters, Travelzoo Network, Travelzoo mobile applications, Jack's Flight Club website, Jack's Flight Club mobile applications, and Jack's Flight Club newsletters. The company's Travelzoo website and newsletters include local deals and getaways listings that allow members to purchase vouchers for offers from local businesses, such as spas, hotels, and restaurants; Jack's Flight Club, a subscription service that provides members with information about exceptional airfares; and Travelzoo Network, a network of third-party websites that list travel deals published by the company. It serves airlines, hotels, cruise lines, vacations packagers, tour operators, destinations, car rental companies, travel agents, theater and performing arts groups, restaurants, spas, and activity companies. Travelzoo Inc. was incorporated in 1998 and is headquartered in New York, New York.