Head-To-Head Review: Dropbox (NASDAQ:DBX) vs. iQIYI (NASDAQ:IQ)

iQIYI (NASDAQ:IQ) and Dropbox (NASDAQ:DBX) are both computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Profitability

This table compares iQIYI and Dropbox’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
iQIYI	-1.45%	-2.44%	-0.71%
Dropbox	19.87%	-49.51%	19.48%

Risk and Volatility

iQIYI has a beta of 0.03, meaning that its stock price is 97% less volatile than the S&P 500. Comparatively, Dropbox has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500.

Institutional and Insider Ownership

52.7% of iQIYI shares are held by institutional investors. Comparatively, 94.8% of Dropbox shares are held by institutional investors. 57.8% of iQIYI shares are held by company insiders. Comparatively, 30.0% of Dropbox shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares iQIYI and Dropbox”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
iQIYI	$27.67 billion	0.07	$104.68 million	($0.06)	-34.17
Dropbox	$2.53 billion	2.79	$452.30 million	$1.77	15.41

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

Analyst Ratings

This is a summary of current recommendations and price targets for iQIYI and Dropbox, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
iQIYI	1	3	3	0	2.29
Dropbox	1	2	1	0	2.00

iQIYI currently has a consensus target price of $2.57, suggesting a potential upside of 25.56%. Dropbox has a consensus target price of $31.33, suggesting a potential upside of 14.86%. Given iQIYI’s stronger consensus rating and higher possible upside, equities analysts clearly believe iQIYI is more favorable than Dropbox.

Summary

Dropbox beats iQIYI on 8 of the 14 factors compared between the two stocks.

About iQIYI

iQIYI, Inc., together with its subsidiaries, provides online entertainment video services in the People's Republic of China. It offers various products and services, including online video, online games, online literature, animations, and other products. The company operates a platform that provides a collection of internet video content, such as professionally produced content licensed from professional content providers and self-produced content. It also offers membership, online advertising, content distribution, and live broadcasting services. In addition, the company operates iQIYI Show, a live broadcasting platform that enables users to follow their favorite hosts and shows in real time through live broadcasting; and iQIYI Lite that offers an easy and quick access to the personalized videos based on their user preferences. Further, it is involved in the talent agency and IP licensing activities, as well as engages in developing a video community app. The company was formerly known as Qiyi.com, Inc. and changed its name to iQIYI, Inc. in November 2017. iQIYI, Inc. was incorporated in 2009 and is headquartered in Beijing, China. iQIYI, Inc. is a subsidiary of Baidu, Inc.

About Dropbox

Dropbox, Inc. provides a content collaboration platform worldwide. The company's platform allows individuals, families, teams, and organizations to collaborate and sign up for free through its website or app, as well as upgrade to a paid subscription plan for premium features. It serves customers in professional services, technology, media, education, industrial, consumer and retail, and financial services industries. The company was formerly known as Evenflow, Inc. and changed its name to Dropbox, Inc. in October 2009. Dropbox, Inc. was incorporated in 2007 and is headquartered in San Francisco, California.