DoubleDown Interactive (NASDAQ:DDI – Get Free Report) and Applied Digital (NASDAQ:APLD – Get Free Report) are both small-cap consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.
Volatility and Risk
DoubleDown Interactive has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, Applied Digital has a beta of 4.67, indicating that its share price is 367% more volatile than the S&P 500.
Profitability
This table compares DoubleDown Interactive and Applied Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| DoubleDown Interactive | 33.28% | 14.78% | 13.54% |
| Applied Digital | -74.95% | -88.87% | -20.16% |
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| DoubleDown Interactive | $342.46 million | 1.71 | $100.89 million | $2.30 | 5.13 |
| Applied Digital | $189.96 million | 9.94 | -$149.27 million | ($1.17) | -7.64 |
DoubleDown Interactive has higher revenue and earnings than Applied Digital. Applied Digital is trading at a lower price-to-earnings ratio than DoubleDown Interactive, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent recommendations for DoubleDown Interactive and Applied Digital, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| DoubleDown Interactive | 0 | 0 | 4 | 0 | 3.00 |
| Applied Digital | 0 | 0 | 6 | 0 | 3.00 |
DoubleDown Interactive presently has a consensus price target of $22.67, indicating a potential upside of 92.25%. Applied Digital has a consensus price target of $10.50, indicating a potential upside of 17.45%. Given DoubleDown Interactive’s higher probable upside, equities analysts plainly believe DoubleDown Interactive is more favorable than Applied Digital.
Insider and Institutional Ownership
65.7% of Applied Digital shares are held by institutional investors. 11.8% of Applied Digital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Summary
DoubleDown Interactive beats Applied Digital on 8 of the 13 factors compared between the two stocks.
About DoubleDown Interactive
DoubleDown Interactive Co., Ltd. engages in the development and publishing of casual games and mobile applications in South Korea. It publishes digital gaming content on mobile and web platforms. The company offers DoubleDown Casino, DoubleDown Classic, DoubleDown Fort Knox, and cash me out games, as well as sells in-game virtual chips. Its games are primarily distributed, marketed, and promoted through third party platform providers. The company was formerly known as The8Games Co., Ltd. and changed its name to DoubleDown Interactive Co., Ltd. in December 2019. The company was incorporated in 2008 and is headquartered in Seoul, South Korea. DoubleDown Interactive Co., Ltd. is a subsidiary of DoubleU Games Co., Ltd.
About Applied Digital
Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.
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