Financial Analysis: Global Blue Group (NYSE:GB) and Gravity (NASDAQ:GRVY)

Global Blue Group (NYSE:GB) and Gravity (NASDAQ:GRVY) are both small-cap business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, risk, earnings, valuation, institutional ownership and dividends.

Risk & Volatility

Global Blue Group has a beta of 0.42, suggesting that its share price is 58% less volatile than the S&P 500. Comparatively, Gravity has a beta of 1.34, suggesting that its share price is 34% more volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Global Blue Group	$458.29 million	2.29	$15.12 million	$0.14	39.50
Gravity	$555.74 million	0.82	$105.61 million	$9.62	6.83

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

Profitability

This table compares Global Blue Group and Gravity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Global Blue Group	7.32%	48.62%	2.67%
Gravity	14.87%	37.85%	30.67%

Insider and Institutional Ownership

89.7% of Global Blue Group shares are owned by institutional investors. Comparatively, 9.9% of Gravity shares are owned by institutional investors. 5.2% of Global Blue Group shares are owned 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.

Analyst Recommendations

This is a summary of current recommendations and price targets for Global Blue Group and Gravity, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Global Blue Group	0	0	1	0	3.00
Gravity	0	0	0	0	0.00

Global Blue Group currently has a consensus price target of $6.00, indicating a potential upside of 8.50%. Given Global Blue Group’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Global Blue Group is more favorable than Gravity.

Summary

Global Blue Group beats Gravity on 8 of the 14 factors compared between the two stocks.

About Global Blue Group

Global Blue Group Holding AG, together with its subsidiaries, provides technology-enabled transaction processing services for merchants, banks, acquirers, governments, and travelers in Europe, the Asia Pacific, and internationally. The company operates in three segments: Tax Free Shopping Technology Solutions (TFSS), Added-Value Payment Solutions (AVPS), and Retail Tech Solutions (RTS). It offers TFSS, a value added tax (VAT) refund service that allows eligible shoppers to reclaim VAT on goods purchased outside of their home country; and intelligence and marketing services. The company also provides AVPS, a service which enables customers to pay in their choice of preferred currency, home or destination, and at the point of sale (POS) when shopping outside of their home country under the Dynamic Currency Choice and Currency Select brands. In addition, it offers currency conversion services for POS, e-commerce return solutions, dynamic currency conversion (DCC) services, and DCC services at ATMs, as well as multi-currency processing services for online retailers. Further, the company provides ZigZag, a technology platform that fully digitalizes the eCommerce returns experience and enhances the process for both retailers and consumers; Yocuda that enables retailers to send digital receipts to their customers; and ShipUp, a post-purchase engagement solution for online purchases enabling brands to deliver seamless, proactive, and branded post-purchase communication. Global Blue Group Holding AG was founded in 1980 and is headquartered in Wangen-Brüttisellen, Switzerland.

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.