Direct Digital (NASDAQ:DRCT – Get Free Report) and Integral Ad Science (NASDAQ:IAS – Get Free Report) are both small-cap business services companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.
Profitability
This table compares Direct Digital and Integral Ad Science’s net margins, return on equity and return on assets.
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Valuation and Earnings
This table compares Direct Digital and Integral Ad Science”s gross revenue, earnings per share (EPS) and valuation.
Integral Ad Science has higher revenue and earnings than Direct Digital. Direct Digital is trading at a lower price-to-earnings ratio than Integral Ad Science, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Direct Digital has a beta of 6.01, suggesting that its stock price is 501% more volatile than the S&P 500. Comparatively, Integral Ad Science has a beta of 1.57, suggesting that its stock price is 57% more volatile than the S&P 500.
Institutional and Insider Ownership
4.0% of Direct Digital shares are owned by institutional investors. Comparatively, 95.8% of Integral Ad Science shares are owned by institutional investors. 62.8% of Direct Digital shares are owned by insiders. Comparatively, 2.0% of Integral Ad Science shares are owned 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 Recommendations
This is a summary of current recommendations and price targets for Direct Digital and Integral Ad Science, as reported by MarketBeat.com.
Direct Digital currently has a consensus price target of $6.00, suggesting a potential upside of 1,328.57%. Integral Ad Science has a consensus price target of $13.55, suggesting a potential upside of 61.31%. Given Direct Digital’s higher possible upside, equities analysts clearly believe Direct Digital is more favorable than Integral Ad Science.
Summary
Integral Ad Science beats Direct Digital on 10 of the 13 factors compared between the two stocks.
About Direct Digital
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Direct Digital Holdings, Inc. operates as an end-to-end full-service programmatic advertising platform. The company’s platform primarily focuses on providing advertising technology, data-driven campaign optimization, and other solutions to underserved and less efficient markets on both the buy- and sell-side of the digital advertising ecosystem. It serves various industry verticals, such as travel, healthcare, education, financial services, consumer products, and other sectors with a focus on small and mid-sized businesses. The company was founded in 2018 and is headquartered in Houston, Texas.
About Integral Ad Science
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Integral Ad Science Holding Corp. operates as a digital advertising verification company in the United States, the United Kingdom, France, Ireland, Germany, Italy, Singapore, Australia, Japan, India, and the Nordics. The company provides IAS Signal, a cloud-based technology platform that offers return on ad spend needs; and deliver independent measurement and verification of digital advertising across devices, channels, and formats, including desktop, mobile, connected TV, social, display, and video. Its digital media quality solutions offer ad fraud detection and prevention, viewability, brand safety and suitability, contextual targeting, inventory yield management, and reporting. In addition, the company offers Quality Impressions, a metric designed to verify that digital ads are served to a real person rather than a bot, viewable on-screen, and presented in a brand-safe and suitable environment in the correct geography; Context Control solution that delivers contextual targeting and brand suitability capabilities; pre-bid programmatic and post-bid verification solutions for advertisers; and optimization and verification solutions for publishers. It serves advertisers and agencies, publishers, and supply side platforms. The company was founded in 2009 and is headquartered in New York, New York.