Head-To-Head Survey: Crexendo (NASDAQ:CXDO) vs. GigaMedia (NASDAQ:GIGM)

Crexendo (NASDAQ:CXDO) and GigaMedia (NASDAQ:GIGM) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitability, analyst recommendations, earnings, dividends and risk.

Volatility and Risk

Crexendo has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, GigaMedia has a beta of 0.48, indicating that its share price is 52% less volatile than the S&P 500.

Insider and Institutional Ownership

9.5% of Crexendo shares are owned by institutional investors. Comparatively, 13.5% of GigaMedia shares are owned by institutional investors. 47.2% of Crexendo shares are owned by company insiders. Comparatively, 1.0% of GigaMedia shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Crexendo	6.15%	13.84%	11.21%
GigaMedia	-50.86%	-4.52%	-4.24%

Analyst Recommendations

This is a summary of current ratings and price targets for Crexendo and GigaMedia, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crexendo	0	1	4	0	2.80
GigaMedia	1	0	0	0	1.00

Crexendo presently has a consensus target price of $10.40, indicating a potential upside of 7.66%. Given Crexendo’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Crexendo is more favorable than GigaMedia.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crexendo	$68.17 million	4.59	$5.07 million	$0.15	64.40
GigaMedia	$3.47 million	4.49	-$1.55 million	($0.15)	-9.40

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

Summary

Crexendo beats GigaMedia on 13 of the 14 factors compared between the two stocks.

About Crexendo

Crexendo, Inc. provides cloud communication platform and services, video collaboration, and managed IT services for businesses in the United States and internationally. It operates through two segments, Cloud Telecommunications Services and Software Solutions. The Cloud Telecommunications segment provides telecommunications services that transmit calls using Internet protocol (IP) or cloud technology, which converts voice signals into digital data packets for transmission over the Internet or cloud; and broadband Internet services, as well as develops end user portals for account and license management, and billing and customer support. This segment is also involved in the sale and lease of cloud telecommunications equipment. In addition, it offers hardware, software, and unified communication solutions for businesses using IP or cloud technology over high-speed internet connection through various devices and user interfaces, such as desktop phones and/or mobile, and desktop applications under the Crexendo brand name. The Software Solutions segment provides a suite of unified communications, collaboration, video conferencing, and contact center solutions. This segment also offers SNAPsolution, an IP-based platform; SNAPaccel, a software-as-a-service based software; subscription maintenance and support services; and professional services, including consulting, technical support, resident engineer, design, and installation services. The company was formerly known as iMergent, Inc. and changed its name to Crexendo, Inc. in May 2011. Crexendo, Inc. was incorporated in 1995 and is based in Tempe, Arizona.

About GigaMedia

GigaMedia Limited, together with its subsidiaries, provides digital entertainment services in Taiwan, Hong Kong, and Macau. The company owns and operates FunTown, a digital entertainment portal that offers mobile and browser-based casual games, as well as provides services such as player clubs, tournaments, avatars, friends and family messenger and online chatting systems, customer service, mobile platform, and customer platform. It also 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 other casual games. In addition, the company 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. GigaMedia Limited was founded in 1998 and is headquartered in Taipei, Taiwan.