Financial Comparison: Motorsport Games (NASDAQ:MSGM) & iQIYI (NASDAQ:IQ)

iQIYI (NASDAQ:IQ) and Motorsport Games (NASDAQ:MSGM) are both small-cap communication services companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, risk, profitability, earnings, analyst recommendations, institutional ownership and valuation.

Insider & Institutional Ownership

52.7% of iQIYI shares are held by institutional investors. Comparatively, 1.7% of Motorsport Games shares are held by institutional investors. 57.8% of iQIYI shares are held by company insiders. Comparatively, 4.6% of Motorsport Games shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares iQIYI and Motorsport Games”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
iQIYI	$3.80 billion	0.22	-$29.50 million	($0.12)	-7.17
Motorsport Games	$11.30 million	1.51	$6.93 million	$0.43	9.49

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

Risk and Volatility

iQIYI has a beta of 0.19, suggesting that its share price is 81% less volatile than the S&P 500. Comparatively, Motorsport Games has a beta of 1.71, suggesting that its share price is 71% more volatile than the S&P 500.

Profitability

This table compares iQIYI and Motorsport Games’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
iQIYI	-3.24%	-6.29%	-1.78%
Motorsport Games	16.15%	41.13%	24.51%

Analyst Ratings

This is a summary of current ratings and price targets for iQIYI and Motorsport Games, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
iQIYI	1	4	1	0	2.00
Motorsport Games	0	1	0	1	3.00

iQIYI presently has a consensus target price of $1.73, suggesting a potential upside of 101.14%. Given iQIYI’s higher possible upside, equities research analysts clearly believe iQIYI is more favorable than Motorsport Games.

Summary

Motorsport Games beats iQIYI on 10 of the 15 factors compared between the two stocks.

About iQIYI

iQIYI, Inc., together with its subsidiaries, provides online entertainment video services in the People's Republic of China. It offers various products and services, including online video, online games, online literature, animations, and other products. The company operates a platform that provides a collection of internet video content, such as professionally produced content licensed from professional content providers and self-produced content. It also offers membership, online advertising, content distribution, and live broadcasting services. In addition, the company operates iQIYI Show, a live broadcasting platform that enables users to follow their favorite hosts and shows in real time through live broadcasting; and iQIYI Lite that offers an easy and quick access to the personalized videos based on their user preferences. Further, it is involved in the talent agency and IP licensing activities, as well as engages in developing a video community app. The company was formerly known as Qiyi.com, Inc. and changed its name to iQIYI, Inc. in November 2017. iQIYI, Inc. was incorporated in 2009 and is headquartered in Beijing, China. iQIYI, Inc. is a subsidiary of Baidu, Inc.

About Motorsport Games

Motorsport Games Inc. develops and publishes multi-platform racing video games in the United States. It operates through Gaming and Esports segments. The company offers rFactor 2, a realistic racing simulation game; NASCAR Heat Mobile, a racing experience for mobile devices; NASCAR Heat 3, NASCAR Heat 4, NASCAR Heat 5, NASCAR Heat Ultimate Edition, and NASCAR 21: Ignition, which are racing video games; KartKraft, a kart racing simulator; NASCAR Rivals, a racing video game; and Le Mans Ultimate, a official game of the FIA World Endurance Championship and 24 Hours of Le Mans. It also organizes and facilitates esports tournaments, competitions, and events for its licensed racing games, as well as on behalf of third-party racing game developers and publishers. The company offers its products for game consoles, personal computer, and mobile platforms through various retail and digital channels, including full-game and downloadable content. The company was founded in 2018 and is headquartered in Miami, Florida. Motorsport Games Inc. operates as a subsidiary of Motorsport Network LLC.