Critical Review: CyberAgent (OTCMKTS:CYGIY) and Alphabet (NASDAQ:GOOG)

Alphabet (NASDAQ:GOOG) and CyberAgent (OTCMKTS:CYGIY) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, risk and valuation.

Analyst Ratings

This is a summary of recent recommendations for Alphabet and CyberAgent, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alphabet	0	4	27	5	3.03
CyberAgent	0	1	0	0	2.00

Alphabet currently has a consensus price target of $383.44, indicating a potential upside of 8.37%. Given Alphabet’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Alphabet is more favorable than CyberAgent.

Profitability

This table compares Alphabet and CyberAgent’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alphabet	37.92%	38.99%	27.41%
CyberAgent	4.60%	18.43%	9.35%

Dividends

Alphabet pays an annual dividend of $0.88 per share and has a dividend yield of 0.2%. CyberAgent pays an annual dividend of $0.03 per share and has a dividend yield of 0.7%. Alphabet pays out 6.7% of its earnings in the form of a dividend. CyberAgent pays out 11.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Alphabet has increased its dividend for 1 consecutive years.

Earnings and Valuation

This table compares Alphabet and CyberAgent”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alphabet	$402.84 billion	10.64	$132.17 billion	$13.11	26.99
CyberAgent	$5.86 billion	0.80	$212.18 million	$0.27	17.04

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

Institutional and Insider Ownership

27.3% of Alphabet shares are held by institutional investors. 13.0% of Alphabet shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Alphabet has a beta of 1.23, indicating that its share price is 23% more volatile than the S&P 500. Comparatively, CyberAgent has a beta of 0.32, indicating that its share price is 68% less volatile than the S&P 500.

Summary

Alphabet beats CyberAgent on 17 of the 18 factors compared between the two stocks.

About Alphabet

Alphabet Inc. offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. It is also involved in the sale of apps and in-app purchases and digital content in the Google Play and YouTube; and devices, as well as in the provision of YouTube consumer subscription services. The Google Cloud segment offers infrastructure, cybersecurity, databases, analytics, AI, and other services; Google Workspace that include cloud-based communication and collaboration tools for enterprises, such as Gmail, Docs, Drive, Calendar, and Meet; and other services for enterprise customers. The Other Bets segment sells healthcare-related and internet services. The company was incorporated in 1998 and is headquartered in Mountain View, California.

About CyberAgent

CyberAgent, Inc. engages in the media, internet advertising, game, and investment development businesses primarily in Japan. The company operates Ameba, a blog service; Tapple for online dating; AWA, a music streaming service; and WinTicket for online betting. It also offers internet advertising agency and ad technology services; and smartphone games. In addition, the company operates a programming school for kids and provides application and reward points exchange platform services; artificial intelligence services; and digital transformation services. CyberAgent, Inc. was incorporated in 1998 and is headquartered in Tokyo, Japan.