Alphabet (NASDAQ:GOOGL – Get Free Report) and System1 (NYSE:SST – Get Free Report) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, institutional ownership, profitability, analyst recommendations, earnings and risk.
Analyst Recommendations
This is a summary of current recommendations and price targets for Alphabet and System1, as reported by MarketBeat.com.
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
Alphabet | 0 | 6 | 29 | 1 | 2.86 |
System1 | 0 | 1 | 1 | 0 | 2.50 |
Alphabet currently has a consensus price target of $193.66, indicating a potential upside of 4.22%. System1 has a consensus price target of $3.50, indicating a potential upside of 141.38%. Given System1’s higher probable upside, analysts plainly believe System1 is more favorable than Alphabet.
Volatility & Risk
Profitability
This table compares Alphabet and System1’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
Alphabet | 25.90% | 29.52% | 20.74% |
System1 | -49.23% | -42.08% | -12.99% |
Valuation and Earnings
This table compares Alphabet and System1’s gross revenue, earnings per share (EPS) and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
Alphabet | $307.39 billion | 7.47 | $73.80 billion | $6.52 | 28.50 |
System1 | $401.97 million | 0.33 | -$227.22 million | ($2.27) | -0.64 |
Alphabet has higher revenue and earnings than System1. System1 is trading at a lower price-to-earnings ratio than Alphabet, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
40.0% of Alphabet shares are owned by institutional investors. Comparatively, 87.5% of System1 shares are owned by institutional investors. 11.6% of Alphabet shares are owned by insiders. Comparatively, 28.3% of System1 shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Summary
Alphabet beats System1 on 11 of the 15 factors compared between the two stocks.
About Alphabet
Alphabet Inc. offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. It is also involved in the sale of apps and in-app purchases and digital content in the Google Play and YouTube; and devices, as well as in the provision of YouTube consumer subscription services. The Google Cloud segment offers infrastructure, cybersecurity, databases, analytics, AI, and other services; Google Workspace that include cloud-based communication and collaboration tools for enterprises, such as Gmail, Docs, Drive, Calendar, and Meet; and other services for enterprise customers. The Other Bets segment sells healthcare-related and internet services. The company was incorporated in 1998 and is headquartered in Mountain View, California.
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.
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