Autoweb (NASDAQ: AUTO) and Marchex (NASDAQ:MCHX) are both small-cap cyclical consumer goods & services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, dividends, earnings and analyst recommendations.

Profitability

This table compares Autoweb and Marchex’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Autoweb 1.51% 7.47% 5.68%
Marchex -3.68% -2.93% -2.63%

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Autoweb $156.68 million 0.76 $3.87 million $0.17 53.53
Marchex $129.55 million 1.08 -$84.06 million ($0.27) -11.89

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

Insider and Institutional Ownership

46.6% of Autoweb shares are held by institutional investors. Comparatively, 48.5% of Marchex shares are held by institutional investors. 12.8% of Autoweb shares are held by insiders. Comparatively, 27.4% of Marchex shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for Autoweb and Marchex, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Autoweb 0 0 2 0 3.00
Marchex 0 1 0 0 2.00

Autoweb currently has a consensus target price of $12.00, indicating a potential upside of 31.87%. Marchex has a consensus target price of $3.00, indicating a potential downside of 6.54%. Given Autoweb’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Autoweb is more favorable than Marchex.

Risk and Volatility

Autoweb has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500. Comparatively, Marchex has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500.

Summary

Autoweb beats Marchex on 10 of the 14 factors compared between the two stocks.

Autoweb Company Profile

AutoWeb, Inc., formerly Autobytel Inc., is an automotive marketing services company that assists automotive retail dealers and automotive manufacturers market and sell new and used vehicles to consumers through the programs for online lead referrals, dealer marketing products and services, and online advertising programs and mobile products. The Company operates through providing automotive marketing services segment. Its consumer-facing automotive Websites, including Website Autobytel.com, provide consumers with information and tools to aid them with the automotive purchase decisions and ability to submit inquiries requesting dealers to contact the consumers regarding purchasing or leasing vehicles. Its AutoWeb pay-per-click advertising marketplace program uses technology to refer consumer traffic to dealers and manufacturer Websites.

Marchex Company Profile

Marchex, Inc. is a mobile advertising analytics company. The Company offers products and services for enterprises that depend on consumer phone calls to drive sales. Its media analytics products can provide actionable intelligence on media channels advertisers use to acquire customers over the phone. Its Marchex Omnichannel Analytics Cloud helps marketers connect customer conversions driven from paid media channels, including search, display and video, social and sites, to phone calls made to a business. Its product offerings include Marchex Call Analytics, Marchex Search Analytics, Marchex Display and Video Analytics, Marchex Social Analytics, Marchex Call Marketplace and Local Leads. Its Local Leads platform is a white-labeled, full service advertising solution for small business resellers, such as Yellow Pages providers and vertical marketing service providers, to sell call advertising, search marketing and other lead generation products.

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