Contrasting Snap (NYSE:SNAP) & BuzzFeed (NASDAQ:BZFD)

Snap (NYSE:SNAP) and BuzzFeed (NASDAQ:BZFD) are both communication services companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Earnings & Valuation

This table compares Snap and BuzzFeed”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Snap	$5.93 billion	1.42	-$460.49 million	($0.09)	-55.23
BuzzFeed	$185.27 million	0.23	-$57.72 million	($1.56)	-0.33

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

Institutional and Insider Ownership

47.5% of Snap shares are held by institutional investors. Comparatively, 37.6% of BuzzFeed shares are held by institutional investors. 22.7% of Snap shares are held by company insiders. Comparatively, 15.6% of BuzzFeed shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Snap and BuzzFeed, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Snap	2	23	11	1	2.30
BuzzFeed	1	1	0	0	1.50

Snap currently has a consensus target price of $7.31, suggesting a potential upside of 47.01%. BuzzFeed has a consensus target price of $1.00, suggesting a potential upside of 93.31%. Given BuzzFeed’s higher possible upside, analysts clearly believe BuzzFeed is more favorable than Snap.

Risk and Volatility

Snap has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500. Comparatively, BuzzFeed has a beta of 4.02, meaning that its stock price is 302% more volatile than the S&P 500.

Profitability

This table compares Snap and BuzzFeed’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Snap	-4.90%	-14.61%	-4.12%
BuzzFeed	-35.83%	-113.86%	-34.00%

Summary

Snap beats BuzzFeed on 11 of the 15 factors compared between the two stocks.

About Snap

Snap Inc. operates as a technology company in North America, Europe, and internationally. The company offers Snapchat, a visual messaging application with various tabs, such as camera, visual messaging, snap map, stories, and spotlight that enable people to communicate visually through short videos and images. It also provides Spectacles, an eyewear product that connects with Snapchat and captures photos and video from a human perspective; and advertising products, including AR ads and Snap ads comprises a single image or video ads, collection ads, dynamic ads, story ads, and commercials. The company was formerly known as Snapchat, Inc. and changed its name to Snap Inc. in September 2016. Snap Inc. was founded in 2010 and is headquartered in Santa Monica, California.

About BuzzFeed

BuzzFeed, Inc., a digital media company, distributes content across owned and operated, as well as third-party platforms. The company offers BuzzFeed, a go-to authority for entertainment, pop culture, and Internet with articles, lists, quizzes, videos, and original series; BuzzFeed News, a pocket friendly newsroom; Tasty, a platform for food content; HuffPost, media platform for news, politics, opinion, entertainment, features, and lifestyle content. It also provides display, programmatic, and video advertising on its owned and operated sites and applications. BuzzFeed, Inc. is headquartered in New York, New York.