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

Institutional and Insider Ownership

43.5% of GDS shares are held by institutional investors. Comparatively, 5.3% of GigaMedia shares are held by institutional investors. 1.0% of GigaMedia shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

GDS has a beta of 3.23, meaning that its share price is 223% more volatile than the S&P 500. Comparatively, GigaMedia has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for GDS and GigaMedia, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GDS 1 0 6 1 2.88
GigaMedia 0 0 0 0 N/A

GDS presently has a consensus price target of $41.14, indicating a potential upside of 42.22%. Given GDS’s higher probable upside, equities analysts clearly believe GDS is more favorable than GigaMedia.

Valuation and Earnings

This table compares GDS 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
GDS $248.40 million 13.68 -$48.38 million ($0.51) -56.73
GigaMedia $11.60 million 2.73 $1.08 million N/A N/A

GigaMedia has lower revenue, but higher earnings than GDS.

Profitability

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

Net Margins Return on Equity Return on Assets
GDS -17.19% -7.97% -2.50%
GigaMedia -21.56% -5.49% -5.07%

Summary

GDS beats GigaMedia on 9 of the 12 factors compared between the two stocks.

GDS Company Profile

GDS Holdings Limited, together with its subsidiaries, designs, builds, and operates data centers in the People's Republic of China. The company provides colocation, managed hosting, and managed cloud services. Its data centers service customers that primarily operate in the Internet and banking industries in Shanghai, Beijing, Shenzhen, Guangzhou, and Chengdu. The company serves Internet companies, financial institutions, telecommunications and IT service providers, and large domestic private sector and multinational corporations. GDS Holdings Limited was incorporated in 2006 and is headquartered in Shanghai, the People's Republic of China.

GigaMedia Company Profile

GigaMedia Limited provides digital entertainment services in Taiwan, Hong Kong, and Macau. The company offers mobile and browser-based casual games through FunTown-branded platform. Its portfolio of PC-based casual games include MahJong, a traditional Chinese tile game; sports games, Web-based RPG, and mobile games; online card games; and chance-based games, including bingo, lotto, horse racing, Sic-Bo, slots, and various casual games. The company also provides Tales Runner, a multi-player online obstacle running game in which players competes by running, jumping, dashing and using items. In addition, it owns and operates GigaCloud, a provider of cloud computing solutions and related services focused on the cloud services market for SMEs in Taiwan. GigaMedia Limited was founded in 1997 and is headquartered in Taipei, Taiwan.

Receive News & Ratings for GDS Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for GDS and related companies with MarketBeat.com's FREE daily email newsletter.