Analyzing Cineverse (NASDAQ:CNVS) and Kartoon Studios (NASDAQ:TOON)

Kartoon Studios (NASDAQ:TOON) and Cineverse (NASDAQ:CNVS) are both small-cap communication services companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Insider & Institutional Ownership

8.6% of Kartoon Studios shares are held by institutional investors. Comparatively, 8.2% of Cineverse shares are held by institutional investors. 6.4% of Kartoon Studios shares are held by insiders. Comparatively, 13.3% of Cineverse shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Kartoon Studios and Cineverse, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kartoon Studios	0	0	0	0	0.00
Cineverse	1	0	2	0	2.33

Cineverse has a consensus price target of $11.50, indicating a potential upside of 327.51%. Given Cineverse’s stronger consensus rating and higher probable upside, analysts plainly believe Cineverse is more favorable than Kartoon Studios.

Risk and Volatility

Kartoon Studios has a beta of 2.08, meaning that its share price is 108% more volatile than the S&P 500. Comparatively, Cineverse has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500.

Earnings and Valuation

This table compares Kartoon Studios and Cineverse”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kartoon Studios	$37.09 million	1.01	-$77.10 million	$0.06	10.53
Cineverse	$65.73 million	0.97	-$8.84 million	($0.59)	-4.56

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

Profitability

This table compares Kartoon Studios and Cineverse’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kartoon Studios	-114.48%	-78.36%	-38.43%
Cineverse	-12.87%	-50.49%	-20.83%

Summary

Cineverse beats Kartoon Studios on 9 of the 14 factors compared between the two stocks.

About Kartoon Studios

Kartoon Studios Inc., a content and brand management company, creates, produces, licenses, and broadcasts educational and multimedia animated content for children worldwide. The company offers Shaq’s Garage, a children’s animated series about the secret adventures; Cocomelon that provides 3D animation videos of traditional nursery rhymes and children’s songs; Eggventurers, a preschool animated series; Barbie Productions that provides animated Barbie series; Octonauts, a children’s television series based on the children’s books; Roblox Rumble, an elimination-style competitive reality series; and Spin Master Productions. It also operates a kartoon channel network and channel frederator network, as well as distributes subscription video on demand services for kids. In addition, the company acts as a licensing agent for Llama Llama, Bee & PuppyCat, and Castlevania. It serves various customers and partners, including broadcasters, consumer products licensees, and online platforms. The company was formerly known as Genius Brands International, Inc. and changed its name to Kartoon Studios Inc. in June 2023. Kartoon Studios Inc. was incorporated in 2006 and is headquartered in Beverly Hills, California.

About Cineverse

Cineverse Corp. operates as a streaming technology and entertainment company. The company operates in two segments, Cinema Equipment, and Content and Entertainment. It owns and operates streaming channels, through its proprietary technology platform. The company also delivers curated content through subscription video on demand (SVOD), dedicated ad-supported (AVOD), and ad-supported streaming linear (FAST) channels, as well as social video streaming services and audio podcasts; operates OTT streaming entertainment channels; and offers monitoring, billing, collection, and verification services. It entertains consumers worldwide by providing premium feature film and television programs, enthusiast streaming channels, and technology services. The company was formerly known as Cinedigm Corp. and changed its name to Cineverse Corp. in May 2023. Cineverse Corp. was incorporated in 2000 and is based in New York, New York.