Head to Head Survey: The9 (NASDAQ:NCTY) and Tucows (NASDAQ:TCX)

Tucows (NASDAQ:TCX) and The9 (NASDAQ:NCTY) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.

Volatility and Risk

Tucows has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, The9 has a beta of 2.42, suggesting that its share price is 142% more volatile than the S&P 500.

Institutional and Insider Ownership

73.6% of Tucows shares are held by institutional investors. Comparatively, 0.5% of The9 shares are held by institutional investors. 9.4% of Tucows shares are held by company insiders. Comparatively, 30.8% of The9 shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Tucows and The9″s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tucows	$390.30 million	0.50	-$75.82 million	($6.84)	-2.57
The9	$15.31 million	5.22	-$10.06 million	N/A	N/A

The9 has lower revenue, but higher earnings than Tucows.

Analyst Recommendations

This is a summary of current recommendations and price targets for Tucows and The9, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tucows	1	0	0	0	1.00
The9	1	0	0	0	1.00

Profitability

This table compares Tucows and The9’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tucows	-19.43%	N/A	-8.88%
The9	N/A	N/A	N/A

Summary

The9 beats Tucows on 6 of the 8 factors compared between the two stocks.

About Tucows

Tucows Inc. provides network access, domain name registration, email, mobile telephony, and other Internet services in North America and Europe. It operates in three segments: Ting, Wavelo and Tucows Domains. The Ting segment provides fiber and fixed wireless internet services. The Wavelo segment offers individual developer tools, subscription, billing management, network orchestration, and provisioning services. This segment also provides billing solutions under Platypus brand. The Tucows Domains segment offers name registration, as well as value added services under OpenSRS, eNom, Ascio, EPAG, and Hover brands. The company was formerly known as Infonautics, Inc. and changed its name to Tucows Inc. in August 2001. Tucows Inc. was incorporated in 1992 and is headquartered in Toronto, Canada.

About The9

The9 Limited operates as a cryptocurrency mining business in China, Eastern Europe, Asia, and North America. The company was formerly known as GameNow.net Limited and changed its name to The9 Limited in February 2004. The9 Limited was incorporated in 1999 and is headquartered in Shanghai, the People’s Republic of China.