iDreamSky Technology (NASDAQ: DSKY) and Mitek Systems (NASDAQ:MITK) are both technology companies, but which is the better business? We will compare the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, dividends, analyst recommendations and risk.

Analyst Recommendations

This is a breakdown of current ratings and target prices for iDreamSky Technology and Mitek Systems, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
iDreamSky Technology 0 0 0 0 N/A
Mitek Systems 0 0 5 0 3.00

Mitek Systems has a consensus target price of $10.60, indicating a potential upside of 8.72%. Given Mitek Systems’ higher possible upside, analysts plainly believe Mitek Systems is more favorable than iDreamSky Technology.

Profitability

This table compares iDreamSky Technology and Mitek Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
iDreamSky Technology -1.50% -1.80% -1.34%
Mitek Systems 5.19% 10.45% 8.65%

Valuation & Earnings

This table compares iDreamSky Technology and Mitek Systems’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
iDreamSky Technology N/A N/A N/A N/A N/A
Mitek Systems $42.16 million 7.77 $5.39 million $0.06 162.53

Mitek Systems has higher revenue and earnings than iDreamSky Technology.

Risk & Volatility

iDreamSky Technology has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500. Comparatively, Mitek Systems has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500.

Institutional and Insider Ownership

42.7% of Mitek Systems shares are held by institutional investors. 8.5% of Mitek Systems shares are held by company 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.

Summary

Mitek Systems beats iDreamSky Technology on 8 of the 9 factors compared between the two stocks.

iDreamSky Technology Company Profile

iDreamSky Technology Limited is a holding company. The Company, through its subsidiaries, and its variable interest entities (VIEs) is principally engaged in the licensing and operating of single player mobile games and mobile online games (the listing business) in the People’s Republic of China. The Company is an independent mobile game publishing platform in China. The Company also operates games as a service, where it offers live game services, engages in live user communications and gains user insights through its multi-dimensional data analysis engine to drive ongoing game optimization and monetization. The Company provides its users with live game services and connects them through friend lists, message boards, leaderboards and user tournaments, enabling in-game interaction and social networking. Its platform offers a range of services, including game redesign and porting, ongoing optimization, marketing, distribution, monetization, payment support and user-related services.

Mitek Systems Company Profile

Mitek Systems, Inc. develops, markets and sells mobile capture and identity verification software solutions for enterprise customers. The Company’s technology allows users to remotely deposit checks, open accounts, get insurance quotes, pay bills, as well as verify their identity by taking pictures of various documents with their camera-equipped smartphones and tablets instead of using the device keyboard. Its technology uses algorithms to correct image distortion, extract relevant data, route images to their desired location and process transactions. Its technology processes images of documents in various ways. The Company’s products include Mobile Verify, Mobile Fill, Mobile Docs, Mobile Deposit and Commercial Mobile Deposit Capture. Its mobile technology solutions are provided in two parts: a software development kit (SDK) for mobile capture, and a software platform for image correction, detection, extraction and authentication.

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