Head-To-Head Review: Locafy (NASDAQ:LCFY) and GAN (NASDAQ:GAN)

Locafy (NASDAQ:LCFY) and GAN (NASDAQ:GAN) are both small-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, analyst recommendations and risk.

Risk & Volatility

Locafy has a beta of 1.21, indicating that its share price is 21% more volatile than the S&P 500. Comparatively, GAN has a beta of 2.03, indicating that its share price is 103% more volatile than the S&P 500.

Insider & Institutional Ownership

0.0% of Locafy shares are held by institutional investors. Comparatively, 16.7% of GAN shares are held by institutional investors. 28.7% of Locafy shares are held by company insiders. Comparatively, 8.5% of GAN shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Locafy and GAN’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Locafy	-66.21%	-82.35%	-45.02%
GAN	-18.48%	N/A	-27.66%

Earnings and Valuation

This table compares Locafy and GAN”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Locafy	$4.29 million	1.77	-$2.62 million	($1.87)	-3.17
GAN	$129.42 million	0.64	-$34.44 million	($0.52)	-3.52

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

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Locafy	0	0	0	0	N/A
GAN	0	1	0	0	2.00

Summary

GAN beats Locafy on 7 of the 11 factors compared between the two stocks.

About Locafy

Locafy Limited operates as a software-as-a-service company (SaaS) that specializes in search engine marketing in Australia, New Zealand, Europe, North America, and internationally. The company operates in three segments: Publishing, Direct Sales, and Reseller Sales. It focuses on commercializing its SaaS online publishing technology platform that comprises an integrated suite of solutions. The company also owns and operates several online directories and offers search engine optimization solutions, which include creation of proximity pages and proximity networks, local pages, and map pack booster. In addition, its platform publishes content to various devices that uses a web browser to display web content, as well as programmatically optimizes the published content for local search. The company offers its solutions directly to customers, as well as through digital agencies and search engine optimization freelancers. The company was formerly known as Moboom Limited and changed its name to Locafy Limited in January 2021. Locafy Limited was incorporated in 2009 and is based in Subiaco, Australia.

About GAN

GAN Limited operates as a business-to-business (B2B) supplier of enterprise software-as-a-service solutions to online casino gaming and sports betting applications in the United States, Europe, Latin America, and internationally. It operates through two segments: B2B and B2C. The company provides and licenses GameSTACK, an internet gaming platform that provides turnkey technology solution for regulated real-money internet gambling, online sports betting, and virtual simulated gaming. It offers Real Money iGaming, GAN sports retail and online sportsbook, super remote gaming server, Simulated Gaming, iSight Back Office, iBridge Framework, and development services; development, marketing, and customer support services designed to fast-track deployments and provide ongoing operational support services. In addition, the company offers online sports betting, online casino game, and peer-to-peer poker services through its coolbet.com website. It serves regional operators and individual tribal casino operators. GAN Limited was incorporated in 1999 and is headquartered in Irvine, California.