GrubHub (GRUB) and SEA (SE) Critical Contrast

SEA (NYSE: SE) and GrubHub (NYSE:GRUB) are both mid-cap technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for SEA and GrubHub, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SEA 0 0 6 0 3.00
GrubHub 1 9 13 0 2.52

SEA presently has a consensus price target of $18.67, suggesting a potential upside of 58.60%. GrubHub has a consensus price target of $59.52, suggesting a potential downside of 16.80%. Given SEA’s stronger consensus rating and higher possible upside, equities research analysts plainly believe SEA is more favorable than GrubHub.

Valuation & Earnings

This table compares SEA and GrubHub’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SEA N/A N/A N/A N/A N/A
GrubHub $493.33 million 12.57 $49.55 million $0.68 105.21

GrubHub has higher revenue and earnings than SEA.

Insider & Institutional Ownership

68.7% of SEA shares are held by institutional investors. 0.2% of SEA shares are held by company insiders. Comparatively, 2.4% of GrubHub shares 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 SEA and GrubHub’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SEA -141.10% N/A -48.73%
GrubHub 9.60% 7.45% 6.07%

Summary

GrubHub beats SEA on 6 of the 9 factors compared between the two stocks.

SEA Company Profile

Sea Limited, formerly Garena Interactive Holding Limited, is an Internet company. The Company operates through three segments: digital entertainment, e-commerce and digital financial services. The Company has developed an integrated platform consisting of digital entertainment focused on online games, e-commerce, and digital financial services focused on e-wallet services. Its platforms include Garena, Shopee, and AirPay. Garena provides access to engaging mobile and personal computer (PC) online games, live streaming game play, as well as social features such as user chat and online forums. Shopee is an e-commerce marketplace where users come together to browse, shop and sell on-the-go, anytime, anywhere. AirPay App is the Company’s digital financial services business that provides e-wallet services to consumers through the AirPay App and to small businesses through the AirPay counter application.

GrubHub Company Profile

Grubhub Inc. provides an online and mobile platform for restaurant pick-up and delivery orders. Its products include Grubhub and Seamless Mobile Applications and Mobile Website, Grubhub and Seamless Websites, Corporate Program, Delivery, Allmenus and MenuPages, Grubhub for Restaurants, and Restaurant Websites. As of December 31, 2016, the Company connected more than 50,000 local restaurants with diners in more than 1,100 cities across the United States. In certain markets, the Company also provides delivery services to restaurants on its platform that do not have their own delivery operations. The Company provides diners on the platform with a personalized platform that helps them search for local restaurants and then place an order from an Internet-connected device. It also provides diners with information about their orders and status. The Company also provides delivery services to restaurants on its platform that do not have their own delivery operations.

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