ReachLocal (RLOC) and Rocket Fuel (FUEL) Head to Head Contrast

ReachLocal (NASDAQ: RLOC) and Rocket Fuel (NASDAQ:FUEL) are both cyclical consumer goods & services companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, earnings, profitability, analyst recommendations and risk.

Earnings & Valuation

This table compares ReachLocal and Rocket Fuel’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ReachLocal N/A N/A N/A ($1.65) -2.79
Rocket Fuel N/A N/A N/A ($1.50) -1.73

ReachLocal is trading at a lower price-to-earnings ratio than Rocket Fuel, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

40.4% of Rocket Fuel shares are owned by institutional investors. 34.9% of Rocket Fuel shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares ReachLocal and Rocket Fuel’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ReachLocal -5.20% N/A -15.27%
Rocket Fuel -20.05% -120.35% -28.17%

Analyst Ratings

This is a breakdown of recent ratings and target prices for ReachLocal and Rocket Fuel, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ReachLocal 0 0 0 0 N/A
Rocket Fuel 0 2 1 0 2.33

Rocket Fuel has a consensus target price of $4.38, indicating a potential upside of 68.27%. Given Rocket Fuel’s higher possible upside, analysts plainly believe Rocket Fuel is more favorable than ReachLocal.

Summary

Rocket Fuel beats ReachLocal on 6 of the 9 factors compared between the two stocks.

About ReachLocal

ReachLocal, Inc. (ReachLocal) offers a range of online marketing and reporting solutions. The Company’s digital marketing solution consists of products and solutions in three categories: digital advertising (including ReachSearch, ReachDisplay, ReachDisplay InApp and ReachRetargeting); Web presence (including ReachSite+ReachEdge, ReachSEO, ReachCast, ReachListings and TotalLiveChat), and software (ReachEdge and Kickserv). It focuses on small to medium-sized businesses (SMBs). The Company delivers its suite of products and solutions to local businesses through a combination of its technology platform, its direct inside and outside sales force, and select third-party agencies and resellers. It also focuses on certain core verticals, which include home services, professional services, specialty services and healthcare. It also provides solutions to multi-location advertisers, such as franchises and other businesses that have multiple locations across a number of cities and states.

About Rocket Fuel

Rocket Fuel Inc. is a technology company, which offers a Programmatic Marketing Platform that is designed for helping marketers and their agencies to connect with consumers through digital media. The Company’s service offerings are organized around platforms, including Data Management Platform (DMP) and Demand Side Platform (DSP), which are used by customers themselves or integrating with other customer relationship management or marketing platforms, and together in various permutations as its Programmatic Marketing Platform. The integrated platform is designed to deliver and optimize media spend to engage, upsell and retarget consumers across addressable channels, including display, mobile and video, and across addressable devices, such as tablets, set top boxes, television and mobile phones. It offers Programmatic Marketing Platform as a managed service, which it operate on behalf of its customers, and as a self-service platform operated by its customers or their agencies directly.

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