RealNetworks (NASDAQ: RNWK) is one of 120 publicly-traded companies in the “Software” industry, but how does it contrast to its rivals? We will compare RealNetworks to related businesses based on the strength of its profitability, risk, analyst recommendations, dividends, institutional ownership, valuation and earnings.

Insider and Institutional Ownership

51.7% of RealNetworks shares are held by institutional investors. Comparatively, 58.0% of shares of all “Software” companies are held by institutional investors. 37.9% of RealNetworks shares are held by company insiders. Comparatively, 19.7% of shares of all “Software” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares RealNetworks and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RealNetworks -20.48% -36.41% -24.73%
RealNetworks Competitors -44.98% -25.44% -10.13%

Risk and Volatility

RealNetworks has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, RealNetworks’ rivals have a beta of 0.98, meaning that their average stock price is 2% less volatile than the S&P 500.

Earnings & Valuation

This table compares RealNetworks and its rivals gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
RealNetworks $126.19 million -$17.23 million -6.91
RealNetworks Competitors $1.49 billion $438.71 million 38.53

RealNetworks’ rivals have higher revenue and earnings than RealNetworks. RealNetworks is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of current ratings and price targets for RealNetworks and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RealNetworks 0 0 1 0 3.00
RealNetworks Competitors 269 2050 4343 84 2.63

RealNetworks presently has a consensus price target of $6.50, indicating a potential upside of 36.27%. As a group, “Software” companies have a potential upside of 4.01%. Given RealNetworks’ stronger consensus rating and higher probable upside, equities analysts clearly believe RealNetworks is more favorable than its rivals.

Summary

RealNetworks rivals beat RealNetworks on 7 of the 12 factors compared.

About RealNetworks

RealNetworks, Inc. creates applications and services that enable to connect with digital media. The Company connects consumers with their digital media directly and through partners, focusing on supporting various network, devices, media types and social networks. It operates through three segments: Consumer Media, Mobile Services and Games. Within its Consumer Media business, its RealPlayer media player software includes features and services that enable consumers to discover, play, download, manage and edit digital video, stream audio and video, download and save photos and videos from the Web, transfer and share content on social networks, and edit their own photo and video content. The Mobile Services segment consists of digital media services it provides to mobile and online service providers as software as a service offerings. It develops, publishes, licenses and distributes casual games.

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