Marketo (NASDAQ: MKTO) and Digimarc (NASDAQ:DMRC) are both technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Institutional & Insider Ownership

56.0% of Digimarc shares are held by institutional investors. 7.5% of Digimarc shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Marketo and Digimarc’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Marketo N/A N/A N/A ($1.70) -20.74
Digimarc $21.79 million 18.59 -$21.67 million ($2.25) -15.89

Marketo has higher earnings, but lower revenue than Digimarc. Marketo is trading at a lower price-to-earnings ratio than Digimarc, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Marketo and Digimarc’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Marketo -23.20% -98.33% -27.18%
Digimarc -90.69% -30.98% -29.02%

Analyst Recommendations

This is a summary of recent recommendations for Marketo and Digimarc, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Marketo 0 0 0 0 N/A
Digimarc 0 1 3 0 2.75

Digimarc has a consensus price target of $45.33, suggesting a potential upside of 26.81%. Given Digimarc’s higher probable upside, analysts plainly believe Digimarc is more favorable than Marketo.

Summary

Digimarc beats Marketo on 6 of the 9 factors compared between the two stocks.

Marketo Company Profile

Marketo, Inc. is a United States-based provider of a cloud-based Engagement Marketing software platform, which enables organizations to involve in engagement marketing. The Company’s platform offers a range applications across various categories, including Marketing Automation, which helps to organize personalized multi-channel marketing campaigns and workflows; Email Marketing, which provides the ability to tap the insights captured in the Audience Hub to send e-mail messages; Mobile Engagement, which engages customers on their mobile devices; Digital Ads, which allows marketers to focus on behavioral data captured in the Audience Hub for personalized digital advertisements; Web Personalization, which helps in personalizing experiences to engage people; Marketing Analytics; Predictive Content, which discovers Website assets, such as e-books and case studies; Marketing Calendar, and Sales Insight. It offers solutions, such as Lead Management solution and Consumer Marketing solution.

Digimarc Company Profile

Digimarc Corporation (Digimarc) enables governments and enterprises to give digital identities to media and objects that computers can sense and recognize. The Company’s Digimarc Discover, Digimarc Barcode and Intuitive Computing Platform are designed to optimize the identification of consumer brand impressions, facilitating mobile-centric shopping. The Company operates through media management solutions segment. The Company’s platform includes means to embed Digimarc Barcodes, invisible and inaudible barcode-like information that is recognizable by smartphones, industrial scanners, and other computer interfaces into various forms of media content, including consumer product packaging. Its Digimarc Barcodes has a range of applications, including facilitating scanning of products at retail checkout, as well as engagement with smartphone-equipped consumers. The Digimarc Barcode allows automatic identification of media without visible computer codes, such as traditional barcodes.

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