Reviewing Direct Digital (NASDAQ:DRCT) & X3 (NASDAQ:XTKG)

Direct Digital (NASDAQ:DRCT) and X3 (NASDAQ:XTKG) are both small-cap business services companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, profitability, valuation, analyst recommendations, dividends and institutional ownership.

Risk & Volatility

Direct Digital has a beta of 6.09, meaning that its stock price is 509% more volatile than the S&P 500. Comparatively, X3 has a beta of 1.77, meaning that its stock price is 77% more volatile than the S&P 500.

Profitability

This table compares Direct Digital and X3’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Direct Digital	-26.76%	N/A	-39.57%
X3	N/A	N/A	N/A

Insider & Institutional Ownership

4.0% of Direct Digital shares are held by institutional investors. Comparatively, 1.9% of X3 shares are held by institutional investors. 25.6% of Direct Digital shares are held by insiders. Comparatively, 23.9% of X3 shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Direct Digital and X3, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Direct Digital	1	1	1	0	2.00
X3	1	0	0	0	1.00

Direct Digital presently has a consensus target price of $330.00, suggesting a potential upside of 41,672.15%. Given Direct Digital’s stronger consensus rating and higher possible upside, analysts plainly believe Direct Digital is more favorable than X3.

Earnings and Valuation

This table compares Direct Digital and X3″s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Direct Digital	$62.29 million	0.01	-$6.24 million	($74.73)	-0.01
X3	$11.61 million	0.19	-$76.24 million	N/A	N/A

Direct Digital has higher revenue and earnings than X3.

Summary

Direct Digital beats X3 on 8 of the 11 factors compared between the two stocks.

About Direct Digital

Direct Digital Holdings, Inc. operates as an end-to-end full-service programmatic advertising platform. The company's platform primarily focuses on providing advertising technology, data-driven campaign optimization, and other solutions to underserved and less efficient markets on both the buy- and sell-side of the digital advertising ecosystem. It serves various industry verticals, such as travel, healthcare, education, financial services, consumer products, and other sectors with a focus on small and mid-sized businesses. The company was founded in 2018 and is headquartered in Houston, Texas.

About X3

X3 Holdings Co Ltd. provides technology solutions and services worldwide. The company offers Global Trade Platform, a digital platform for trading partners, service providers, and government authorities. It also engages in bitcoin cryptomining operations, renewable energy projects, and agriculture technologies and trading. The company was formerly known as Powerbridge Technologies Co., Ltd. and changed its name to X3 Holdings Co Ltd. in January 2024. X3 Holdings Co Ltd. was founded in 1997 and is headquartered in Singapore.