Head-To-Head Analysis: System1 (NYSE:SST) & WPP (NYSE:WPP)

System1 (NYSE:SST) and WPP (NYSE:WPP) are both business services companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, dividends and valuation.

Risk and Volatility

System1 has a beta of 1.5, indicating that its stock price is 50% more volatile than the S&P 500. Comparatively, WPP has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.

Profitability

This table compares System1 and WPP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
System1	-42.18%	-439.90%	-18.89%
WPP	N/A	N/A	N/A

Insider & Institutional Ownership

87.5% of System1 shares are owned by institutional investors. Comparatively, 4.3% of WPP shares are owned by institutional investors. 10.2% of System1 shares are owned by insiders. Comparatively, 1.0% of WPP shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares System1 and WPP”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
System1	$266.13 million	0.09	-$65.35 million	($12.00)	-0.19
WPP	$17.87 billion	0.19	-$283.52 million	N/A	N/A

System1 has higher earnings, but lower revenue than WPP.

Analyst Recommendations

This is a summary of recent recommendations for System1 and WPP, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
System1	1	0	1	0	2.00
WPP	2	4	3	0	2.11

System1 presently has a consensus target price of $10.00, indicating a potential upside of 327.90%. Given System1’s higher probable upside, analysts clearly believe System1 is more favorable than WPP.

Summary

WPP beats System1 on 7 of the 12 factors compared between the two stocks.

About System1

System1, Inc. provides omnichannel customer acquisition platform services through its proprietary responsive acquisition marketing platform in the United States, the United Kingdom, Canada, the Netherlands, and internationally. It operates through two segments: Owned and Operated Advertising, and Partner Network. The company engages in the provision of acquiring traffic to its owned and operated websites, as well as revenue-sharing arrangements and related services. It also operates MapQuest, a web-based navigation service that delivers turn-by-turn direction services to users; Info.com, a metasearch engine that consumers can use to search for relevant information; HowStuffWorks, a commercial website focused on helping people solve problems in their daily lives by using various types of digital media to easily breakdown and explain complex concepts, topics, terminology and mechanisms; Startpage, a private search engine that allows users to browse and search the Internet in complete privacy; and CouponFollow for coupon destinations for online shoppers, as well as ActiveBeat and Infospace. In addition, the company provides antivirus software solutions, which offers customers a single packaged solution that provides protection and reporting to the end users. The company is based in Los Angeles, California.

About WPP

WPP plc, a creative transformation company, provides communications, experience, commerce, and technology services in North America, the United Kingdom, Western Continental Europe, the Asia Pacific, Latin America, Africa, the Middle East, and Central and Eastern Europe. The company operates through three segments: Global Integrated Agencies, Public Relations, and Specialist Agencies. It offers marketing strategy, creative ideation, production, commerce, influencer marketing, social media management, and technology implementation services; media strategy, planning, buying and activation, commerce media, data analytics, and consulting services; and media management, public affairs, reputation, risk and crisis management, social media management, and strategic advisory services. The company also provides brand consulting, brand identity, product and service design, and corporate and brand publication services. WPP plc was founded in 1985 and is based in London, the United Kingdom.