Critical Contrast: Roku (NASDAQ:ROKU) vs. PLAYSTUDIOS (NASDAQ:MYPS)

PLAYSTUDIOS (NASDAQ:MYPS) and Roku (NASDAQ:ROKU) are both communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, valuation, institutional ownership, profitability, earnings and dividends.

Volatility & Risk

PLAYSTUDIOS has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500. Comparatively, Roku has a beta of 2.05, suggesting that its stock price is 105% more volatile than the S&P 500.

Institutional & Insider Ownership

37.5% of PLAYSTUDIOS shares are owned by institutional investors. Comparatively, 86.3% of Roku shares are owned by institutional investors. 14.9% of PLAYSTUDIOS shares are owned by company insiders. Comparatively, 13.5% of Roku shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares PLAYSTUDIOS and Roku’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PLAYSTUDIOS	-20.65%	-19.61%	-15.33%
Roku	6.82%	13.73%	8.34%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for PLAYSTUDIOS and Roku, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PLAYSTUDIOS	1	2	1	0	2.00
Roku	0	19	7	1	2.33

PLAYSTUDIOS currently has a consensus target price of $12.50, indicating a potential upside of 237.02%. Roku has a consensus target price of $156.17, indicating a potential downside of 0.24%. Given PLAYSTUDIOS’s higher probable upside, equities research analysts plainly believe PLAYSTUDIOS is more favorable than Roku.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PLAYSTUDIOS	$235.10 million	0.19	-$28.64 million	($3.60)	-1.03
Roku	$5.21 billion	4.46	$88.36 million	$2.34	66.90

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

Summary

Roku beats PLAYSTUDIOS on 13 of the 15 factors compared between the two stocks.

About PLAYSTUDIOS

PLAYSTUDIOS, Inc. develops and publishes free-to-play casual games for mobile and social platforms in the United States and internationally. The company's game portfolio includes a diverse range of titles comprising social casino, card, puzzle, and adventure games. It also offers POP! Slots, myVEGAS Slots, my KONAMI Slots, MGM Slots Live, myVEGAS Blackjack, myVEGAS Bingo, Tetris, Solitaire, Spider Solitaire, Jumbline 2, Sudoku, and Mahjong games. PLAYSTUDIOS, Inc. is headquartered in Las Vegas, Nevada.

About Roku

Roku, Inc., together with its subsidiaries, operates a TV streaming platform in the United states and internationally. The company operates in two segments, Platform and Devices. Its streaming platform allows users to find and access TV shows, movies, news, sports, and others. The Platform segment offers digital advertising, including direct and programmatic video advertising, media and entertainment promotional spending, and related services; and streaming services distribution, such as subscription and transaction revenue shares, and sale of premium subscriptions and branded app buttons on remote controls. The Devices segment provides sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories as well as licensing arrangements with service operators. Roku, Inc. was incorporated in 2002 and is headquartered in San Jose, California.