Starz Acquisition (NASDAQ: STRZA) and TiVo Corporation (NASDAQ:TIVO) are both cyclical consumer goods & services companies, but which is the better business? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, earnings, valuation, dividends and profitabiliy.

Insider & Institutional Ownership

80.2% of Starz Acquisition shares are owned by institutional investors. Comparatively, 89.6% of TiVo Corporation shares are owned by institutional investors. 8.5% of Starz Acquisition shares are owned by insiders. Comparatively, 3.6% of TiVo Corporation 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.

Dividends

TiVo Corporation pays an annual dividend of $0.72 per share and has a dividend yield of 3.8%. Starz Acquisition does not pay a dividend. TiVo Corporation pays out 240.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk & Volatility

Starz Acquisition has a beta of 0.07, suggesting that its share price is 93% less volatile than the S&P 500. Comparatively, TiVo Corporation has a beta of 0.16, suggesting that its share price is 84% less volatile than the S&P 500.

Profitability

This table compares Starz Acquisition and TiVo Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Starz Acquisition -68.21% -14.75% -6.41%
TiVo Corporation 2.47% 10.59% 5.99%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Starz Acquisition and TiVo Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Starz Acquisition 0 1 1 0 2.50
TiVo Corporation 0 1 5 0 2.83

Starz Acquisition presently has a consensus target price of $31.50, indicating a potential downside of 9.82%. TiVo Corporation has a consensus target price of $27.60, indicating a potential upside of 46.03%. Given TiVo Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe TiVo Corporation is more favorable than Starz Acquisition.

Earnings and Valuation

This table compares Starz Acquisition and TiVo Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Starz Acquisition N/A N/A N/A $1.79 19.51
TiVo Corporation $736.47 million 3.08 $228.08 million $0.30 63.00

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

Summary

TiVo Corporation beats Starz Acquisition on 10 of the 13 factors compared between the two stocks.

About Starz Acquisition

Starz Acquisition LLC, formerly Starz, is an integrated media and entertainment company. The Company provides premium subscription video programming in the United States to cable operators, satellite television providers, telecommunications companies and online video providers. The Company’s segments include Starz Networks and Starz Distribution. The Starz Networks segment provides premium subscription video programming to the United States multichannel video programming distributors (MVPDs), including cable operators (such as Comcast and Time Warner Cable), satellite television providers (such as DIRECTV and DISH Network) and telecommunications companies (such as AT&T and Verizon). The Starz Distribution segment includes the operations of its Anchor Bay Entertainment, Starz Digital and Starz Worldwide Distribution businesses. It also develops, produces and acquires entertainment content and distributes this content to consumers in the United States and throughout the world.

About TiVo Corporation

TiVo Corporation is engaged in offering media and entertainment products. The Company operates through two segments: Intellectual Property Licensing and Product. The Company’s Product segment includes a suite of component technologies that can be integrated into media service provider internally developed platforms or deployed as an integrated TiVo solution. The Company provides a range of intellectual property, cloud-based services and set-top box solutions that enable people to use online video, television, movies and music entertainment, including content discovery through device embedded and cloud-based interactive program guides (IPGs), digital video recorders (DVRs), natural language voice and text search, cloud-based recommendations services and its entertainment metadata (descriptive information, promotional images or other content that describes or relates to television shows, videos, movies, sports, music, books, games or other entertainment content).

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