GigaMedia (NASDAQ:GIGM) and DigitalOcean (NASDAQ:DOCN) Head-To-Head Comparison

GigaMedia (NASDAQ:GIGMGet Rating) and DigitalOcean (NASDAQ:DOCNGet Rating) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.

Institutional & Insider Ownership

3.6% of GigaMedia shares are held by institutional investors. Comparatively, 62.0% of DigitalOcean shares are held by institutional investors. 1.0% of GigaMedia shares are held by insiders. Comparatively, 4.1% of DigitalOcean shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares GigaMedia and DigitalOcean’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
GigaMedia $5.49 million 3.06 -$3.42 million ($0.34) -4.47
DigitalOcean $428.56 million 10.48 -$19.50 million ($0.32) -132.37

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for GigaMedia and DigitalOcean, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GigaMedia 0 0 0 0 N/A
DigitalOcean 0 1 8 0 2.89

DigitalOcean has a consensus target price of $63.50, indicating a potential upside of 49.91%. Given DigitalOcean’s higher probable upside, analysts clearly believe DigitalOcean is more favorable than GigaMedia.

Profitability

This table compares GigaMedia and DigitalOcean’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GigaMedia -65.36% -7.09% -6.48%
DigitalOcean -7.42% -5.00% -2.33%

Volatility & Risk

GigaMedia has a beta of 0.23, indicating that its share price is 77% less volatile than the S&P 500. Comparatively, DigitalOcean has a beta of 1.86, indicating that its share price is 86% more volatile than the S&P 500.

Summary

DigitalOcean beats GigaMedia on 11 of the 13 factors compared between the two stocks.

GigaMedia Company Profile (Get Rating)

GigaMedia Limited provides digital entertainment services in Taiwan and Hong Kong. The company operates FunTown, a digital entertainment portal that offers mobile and browser-based casual games through -branded platform. It offers MahJong, a traditional Chinese tile-based game; casual card and table games; online card games; and chance-based games, including bingo, lotto, horse racing, Sic-Bo, slots, and various casual games. It also provides role-playing and sports games, such as Tales Runner, a multi-player online obstacle running game; Yume 100, a story-based game that targets female players; Akaseka, a female-oriented game; and Shinobi Master New Link, a male-oriented game. The company was founded in 1998 and is headquartered in Taipei, Taiwan.

DigitalOcean Company Profile (Get Rating)

DigitalOcean Holdings, Inc., through its subsidiaries, operates a cloud computing platform in North America, Europe, Asia, and internationally. Its platform provides on-demand infrastructure and platform tools for developers, start-ups, and small and medium size businesses. The company offers infrastructure solutions across compute, storage, and networking, as well as enables developers to extend the native capabilities of its cloud with fully managed application, container, and database offerings. Its users include software engineers, researchers, data scientists, system administrators, students, and hobbyists. The company's customers use its platform in various industry verticals and for a range of use cases, such as web and mobile applications, website hosting, e-commerce, media and gaming, personal web projects, managed services, and others. DigitalOcean Holdings, Inc. was incorporated in 2012 and is headquartered in New York, New York.

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