Financial Analysis: System1 (NYSE:SST) and Match Group (NASDAQ:MTCH)

System1 (NYSE:SST) and Match Group (NASDAQ:MTCH) are both communication services companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Insider & Institutional Ownership

87.5% of System1 shares are held by institutional investors. Comparatively, 94.1% of Match Group shares are held by institutional investors. 10.2% of System1 shares are held by company insiders. Comparatively, 0.7% of Match Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares System1 and Match Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
System1	$266.13 million	0.07	-$65.35 million	($11.31)	-0.15
Match Group	$3.49 billion	2.53	$613.45 million	$2.83	13.60

Match Group has higher revenue and earnings than System1. System1 is trading at a lower price-to-earnings ratio than Match Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares System1 and Match Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
System1	-50.66%	-439.90%	-19.35%
Match Group	20.69%	-324.86%	17.84%

Risk and Volatility

System1 has a beta of 1.69, indicating that its share price is 69% more volatile than the S&P 500. Comparatively, Match Group has a beta of 1.47, indicating that its share price is 47% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings for System1 and Match Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
System1	1	1	1	0	2.00
Match Group	0	9	9	0	2.50

System1 currently has a consensus price target of $6.50, suggesting a potential upside of 271.64%. Match Group has a consensus price target of $45.64, suggesting a potential upside of 18.55%. Given System1’s higher probable upside, equities analysts plainly believe System1 is more favorable than Match Group.

Summary

Match Group beats System1 on 11 of the 14 factors compared between the two stocks.

About System1

System1, Inc. provides omnichannel customer acquisition platform services through its proprietary responsive acquisition marketing platform in the United States, the United Kingdom, Canada, the Netherlands, and internationally. It operates through two segments: Owned and Operated Advertising, and Partner Network. The company engages in the provision of acquiring traffic to its owned and operated websites, as well as revenue-sharing arrangements and related services. It also operates MapQuest, a web-based navigation service that delivers turn-by-turn direction services to users; Info.com, a metasearch engine that consumers can use to search for relevant information; HowStuffWorks, a commercial website focused on helping people solve problems in their daily lives by using various types of digital media to easily breakdown and explain complex concepts, topics, terminology and mechanisms; Startpage, a private search engine that allows users to browse and search the Internet in complete privacy; and CouponFollow for coupon destinations for online shoppers, as well as ActiveBeat and Infospace. In addition, the company provides antivirus software solutions, which offers customers a single packaged solution that provides protection and reporting to the end users. The company is based in Los Angeles, California.

About Match Group

Match Group, Inc. engages in the provision of dating products. Its portfolio of brands includes Tinder, Hinge, Match, Meetic, OkCupid, Pairs, Plenty Of Fish, Azar, BLK, and Hakuna, as well as a various other brands, each built to increase users' likelihood of connecting with others. Its services are available in over 40 languages to users worldwide. The company was incorporated in 1986 and is based in Dallas, Texas.