Contrasting Yahoo! (YHOO) and JD.com (JD)
Yahoo! (NASDAQ: YHOO) and JD.com (NASDAQ:JD) are both large-cap computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitabiliy, institutional ownership, valuation, dividends, risk, analyst recommendations and earnings.
This table compares Yahoo! and JD.com’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
82.7% of Yahoo! shares are owned by institutional investors. Comparatively, 49.1% of JD.com shares are owned by institutional investors. 9.2% of Yahoo! shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a summary of current ratings and recommmendations for Yahoo! and JD.com, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Yahoo! presently has a consensus target price of $46.46, suggesting a potential downside of 11.73%. JD.com has a consensus target price of $35.54, suggesting a potential downside of 7.44%. Given JD.com’s stronger consensus rating and higher possible upside, analysts clearly believe JD.com is more favorable than Yahoo!.
Earnings & Valuation
This table compares Yahoo! and JD.com’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Yahoo!||$5.41 billion||9.32||$260.79 million||($0.02)||-2,630.18|
|JD.com||$41.18 billion||1.32||$479.24 million||($0.29)||-132.41|
JD.com has higher revenue and earnings than Yahoo!. Yahoo! is trading at a lower price-to-earnings ratio than JD.com, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Yahoo! has a beta of 1.8, indicating that its share price is 80% more volatile than the S&P 500. Comparatively, JD.com has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.
Yahoo! beats JD.com on 8 of the 13 factors compared between the two stocks.
Yahoo! Inc. (Yahoo), along with its subsidiaries, is engaged in digital information discovery. The Company’s segments include the Americas; Europe, Middle East and Africa (EMEA), and Asia Pacific. The Company focuses on informing, connecting and entertaining its users with its search (Yahoo search), communications, including Yahoo Mail and Yahoo Messenger, and digital content products, including Tumblr, and its four verticals, such as Yahoo News, Yahoo Sports, Yahoo Finance and Yahoo Lifestyle. Yahoo Search is a search engine that serves as a guide for users to discover the information on the Internet. Yahoo Mail connects users to the people and things across mobile and desktop. Yahoo Messenger is an instant messaging service that provides an interactive and personalized way for users to connect and communicate in real-time. The Company’s Digital Content offerings include Tumblr, its social platform, and its four verticals, including News, Sports, Finance and Lifestyle.
JD.com, Inc. is an online direct sales company. The Company engages in the sale of electronics and home appliance products and general merchandise products (including audio, video products and books) sourced from manufacturers, distributors and publishers in China on the Internet through its Website, www.jd.com. It also offers an online marketplace that enables third-party sellers to sell their products to customers on the Company’s Website. The Company operates through the provision of a single class of services for accelerating and improving the delivery of its products over the Internet. The Company also offers online and in-person payment options and customer services. The Company operates approximately 210 warehouses with an aggregate gross floor area of approximately four million square meters in over 50 cities. It operates over 5,370 delivery stations and pickup stations in approximately 2,350 counties and districts across China.
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