DHX Media (NASDAQ: DHXM) and Viacom (NASDAQ:VIAB) are both cyclical consumer goods & services companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Dividends

Viacom pays an annual dividend of $0.80 per share and has a dividend yield of 3.4%. DHX Media does not pay a dividend. Viacom pays out 22.0% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares DHX Media and Viacom’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
DHX Media N/A N/A N/A $0.07 44.29
Viacom $12.49 billion 0.75 $1.44 billion $3.64 6.39

Viacom has higher revenue and earnings than DHX Media. Viacom is trading at a lower price-to-earnings ratio than DHX Media, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

DHX Media has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, Viacom has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for DHX Media and Viacom, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DHX Media 0 3 4 0 2.57
Viacom 6 14 8 0 2.07

DHX Media presently has a consensus price target of $9.13, suggesting a potential upside of 194.35%. Viacom has a consensus price target of $38.77, suggesting a potential upside of 66.61%. Given DHX Media’s stronger consensus rating and higher possible upside, equities analysts plainly believe DHX Media is more favorable than Viacom.

Profitability

This table compares DHX Media and Viacom’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DHX Media 4.46% 5.05% 1.91%
Viacom 11.04% 30.89% 6.39%

Institutional & Insider Ownership

79.1% of Viacom shares are held by institutional investors. 0.4% of Viacom shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Viacom beats DHX Media on 10 of the 13 factors compared between the two stocks.

About DHX Media

DHX Media Ltd is a Canada-based creator, producer, distributor, licensor and broadcaster of kids and family television and film productions. The Company develops, produces and distributes films and television programs for the domestic and international market, broadcasts films and television programs for the domestic markets, as well, the Company manages copyrights, licensing and brands for third parties. It operates through three segments being: Content Business, Copyright Promotions Licensing Group Ltd. (CPLG) and 8504601 Canada Inc. (DHX Television). The Content Business segment includes production, distribution and merchandising operations. The CPLG segment manages copyrights, licensing and brands for third parties. It has five business lines: production (including production service); library and distribution (including digital distribution) of its third party acquired titles; television broadcasting; merchandising and licensing, and new media and interactive.

About Viacom

Viacom Inc. offers global media brands that create television programs, motion pictures, short-form content, applications, games, consumer products, social media experiences and other entertainment content. As of September 30, 2016, the Company offered its services for audiences in more than 180 countries. The Company operates through two segments: Media Networks and Filmed Entertainment. The Media Networks segment creates, acquires and distributes programming and other content for audiences The Media Networks segment provides entertainment content and related branded products for advertisers, content distributors and retailers. The Filmed Entertainment segment produces, finances, acquires and distributes motion pictures, television programming and other entertainment content under the Paramount Pictures, Paramount Vantage, Paramount Classics, Paramount Animation, Insurge Pictures, Nickelodeon Movies, MTV Films and Paramount Television brands.

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