Financial Comparison: Veritone (NASDAQ:VERI) vs. Gravity (NASDAQ:GRVY)

Veritone (NASDAQ:VERI) and Gravity (NASDAQ:GRVY) are both small-cap business services companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Analyst Ratings

This is a summary of recent ratings for Veritone and Gravity, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Veritone	0	3	0	0	2.00
Gravity	0	0	0	0	0.00

Veritone currently has a consensus target price of $2.88, suggesting a potential downside of 12.35%. Given Veritone’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Veritone is more favorable than Gravity.

Volatility and Risk

Veritone has a beta of 3.22, meaning that its stock price is 222% more volatile than the S&P 500. Comparatively, Gravity has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500.

Profitability

This table compares Veritone and Gravity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Veritone	-47.97%	-649.13%	-10.32%
Gravity	14.98%	34.76%	28.79%

Valuation & Earnings

This table compares Veritone and Gravity”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Veritone	$124.88 million	1.01	-$58.62 million	($2.16)	-1.52
Gravity	$516.65 billion	0.00	$105.61 million	$8.98	7.03

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

Institutional and Insider Ownership

39.2% of Veritone shares are held by institutional investors. Comparatively, 9.9% of Gravity shares are held by institutional investors. 26.6% of Veritone shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Gravity beats Veritone on 7 of the 13 factors compared between the two stocks.

About Veritone

Veritone, Inc., together with its subsidiaries, engages in the provision of artificial intelligence (AI) computing solutions and services in the United States, the United Kingdom, France, Australia, Israel, and India. It develops and operates aiWARE platform, an AI operating system, that uses machine learning algorithms or AI models designed to mimic human cognitive functions, such as perception, prediction, and problem solving and optimization, as well as enables users to transform unstructured data into structured data, and analyze and optimize data to drive business processes and insights. The company also provides media advertising agency services, including media planning and strategy, media buying and placement, campaign messaging, clearance verification and attribution, and custom analytics directly to advertisers through outbound sales networking, and client and partner referrals, as well as indirectly through advertising agencies or marketing consultants. It serves media and entertainment, government, legal and compliance, energy, and other vertical markets. The company was formerly known as Veritone Delaware, Inc. and changed its name to Veritone, Inc. in July 2014. Veritone, Inc. was incorporated in 2014 and is headquartered in Denver, Colorado.

About Gravity

Gravity Co., Ltd. develops and publishes online and mobile games worldwide. It offers a massively multiplayer online role-playing game, including Ragnarok Online, Dragonica, Ragnarok Online II, and Ragnarok Landverse. Its mobile games portfolio includes Ragnarok M; Eternal Love; Ragnarok Origin; Ragnarok X: Next Generation; Ragnarok Arena; WITH ISLAND; the Labyrinth of Ragnarok; Ragnarok Poring Merge; Tera Classic; Ragnarok: The Lost Memories; Sadako M; NBA: Rise To Stardom; Milkmaid Of The Milky Way; Generation Zombie; Ragnarok Idle Adventure; Ragnarok 20 Heroes; White Chord; WITH: Whale In The High; Ragnarok Lost Memories; and Paladog Tactics. It also provides console games, such as Ragnarok DS for Nintendo DS; Ragnarok: The Princess of Light and Darkness for PlayStation Portable; Ragnarok Odyssey for PlayStation Vita; Double Dragon II for Xbox 360; Ragnarok Odyssey Ace for PlayStation Vita and PlayStation 3; Pigromance for Steam, Stove, Nintendo Switch, Xbox One, Xbox Series X|S; ALTF4 11 for Steam and Stove; Wetory for Steam, Stove, Nintedo Switch; and GRANDIA HD Collection for Nintendo Switch. In addition, it offers games for IPTV, including Haunted House and Pororo: The Little Penguin, and Kongsuni; and markets dolls, stationery, food, and other character based merchandises, as well as game manuals, monthly magazines, and other publications; PC games, including Puzzle Platformer, ALTF42, Ragnarok ZERO, KAMiBAKO-Mythology of Cube, Psychodemic, and FINAL KNIGHT; social network games and mobile games, such as Ragnarok V: Returns, Ragnarok: The Lost Memories and Ragnrok Begins in-house; and web-browser-based games, such as Ragnarok Prequel and Ragnarok Prequel II. Further, the company provides system development and maintenance services, as well as system integration services to third parties. The company was incorporated in 2000 and is headquartered in Seoul, South Korea. Gravity Co., Ltd. is a subsidiary of GungHo Online Entertainment, Inc.