Beasley Broadcast Group (NASDAQ: BBGI) and Pandora Media (NYSE:P) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, dividends and risk.

Risk and Volatility

Beasley Broadcast Group has a beta of 0.77, indicating that its share price is 23% less volatile than the S&P 500. Comparatively, Pandora Media has a beta of -0.25, indicating that its share price is 125% less volatile than the S&P 500.

Profitability

This table compares Beasley Broadcast Group and Pandora Media’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Beasley Broadcast Group 25.94% 12.35% 4.05%
Pandora Media -39.49% -74.78% -23.38%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Beasley Broadcast Group and Pandora Media, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Beasley Broadcast Group 0 0 0 0 N/A
Pandora Media 2 24 11 0 2.24

Pandora Media has a consensus price target of $10.31, indicating a potential upside of 129.59%. Given Pandora Media’s higher probable upside, analysts clearly believe Pandora Media is more favorable than Beasley Broadcast Group.

Earnings and Valuation

This table compares Beasley Broadcast Group and Pandora Media’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Beasley Broadcast Group $136.66 million 2.39 $47.48 million $2.20 5.16
Pandora Media $1.38 billion 0.81 -$342.97 million ($2.49) -1.80

Beasley Broadcast Group has higher earnings, but lower revenue than Pandora Media. Pandora Media is trading at a lower price-to-earnings ratio than Beasley Broadcast Group, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

14.7% of Beasley Broadcast Group shares are held by institutional investors. 61.6% of Beasley Broadcast Group shares are held by company insiders. Comparatively, 2.6% of Pandora Media shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Beasley Broadcast Group pays an annual dividend of $0.18 per share and has a dividend yield of 1.6%. Pandora Media does not pay a dividend. Beasley Broadcast Group pays out 8.2% of its earnings in the form of a dividend.

Summary

Beasley Broadcast Group beats Pandora Media on 11 of the 15 factors compared between the two stocks.

About Beasley Broadcast Group

Beasley Broadcast Group, Inc. is a radio broadcasting company. The Company’s primary business is operating radio stations throughout the United States. As of December 31, 2016, the Company owned and operated 63 radio stations in various radio markets, Atlanta and Augusta in Georgia; Boston, Massachusetts; Charlotte, North Carolina; Detroit, Michigan; Fayetteville, North Carolina; Fort Myers-Naples, Florida; Las Vegas, Nevada; Middlesex, New Jersey; Monmouth, New Jersey; Morristown, New Jersey; Philadelphia, Pennsylvania; Tampa-Saint Petersburg, Florida; West Palm Beach-Boca Raton, Florida, and Wilmington, Delaware. The Company operates its radio stations in clusters to capture a range of demographic listener groups.

About Pandora Media

Pandora Media, Inc. (Pandora) is a music discovery platform, offering a personalized experience for each of its listeners wherever and whenever they want to listen to music, whether through earbuds, car speakers or live on stage. The Company delivers targeted messages to its listeners using a combination of audio, display and video advertisements. Its segments include Pandora-Internet Radio Service and Ticketfly. As of December 31, 2016, it provided Pandora service through two models: advertising-supported service and subscription service-Pandora Plus. Pandora is integrated with connected devices, including automobiles, automotive aftermarket devices and consumer electronic devices. Its Ticketfly service is a cloud ticketing platform for live events. It operates ticketing service through its subsidiary, Ticketfly, a live events technology company that provides ticketing and marketing software and services for its clients, which are venues and event promoters, across North America.

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