Analyzing Travelzoo (NASDAQ:TZOO) and Opera (NASDAQ:OPRA)

Opera (NASDAQ:OPRA) and Travelzoo (NASDAQ:TZOO) are both small-cap communication services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, earnings, valuation and analyst recommendations.

Risk and Volatility

Opera has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500. Comparatively, Travelzoo has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Valuation & Earnings

This table compares Opera and Travelzoo”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Opera	$614.83 million	2.67	$108.28 million	$1.39	13.26
Travelzoo	$91.72 million	0.70	$4.70 million	$0.03	208.33

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

Profitability

This table compares Opera and Travelzoo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Opera	18.55%	9.14%	8.03%
Travelzoo	0.51%	-9.35%	1.00%

Analyst Ratings

This is a breakdown of current ratings for Opera and Travelzoo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Opera	0	2	3	0	2.60
Travelzoo	2	0	2	0	2.00

Opera currently has a consensus target price of $24.75, indicating a potential upside of 34.29%. Travelzoo has a consensus target price of $13.83, indicating a potential upside of 121.33%. Given Travelzoo’s higher probable upside, analysts plainly believe Travelzoo is more favorable than Opera.

Insider & Institutional Ownership

10.2% of Opera shares are held by institutional investors. Comparatively, 27.4% of Travelzoo shares are held by institutional investors. 84.4% of Opera shares are held by insiders. Comparatively, 45.3% of Travelzoo shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Opera beats Travelzoo on 10 of the 14 factors compared between the two stocks.

About Opera

Opera Limited, together with its subsidiaries, provides mobile and PC web browsers and related products and services in Norway and internationally. The company offers mobile browser products, such as Opera Mini, Opera browser for Android and iOS, and Opera GX for PCs and Mobile; Opera Touch; PC browsers, including Opera for Computers and Opera GX; Apex Football; Opera VPN Pro; and Opera News, an AI-powered personalized news discovery and aggregation service. It provides Opera Crypto Browser for PCs and mobile; browser-based cashback rewards programs; owns GameMaker Studio, a 2D gaming development platform; and GXC, a gaming portal. In addition, the company operates Opera Ads, an online advertising platform; and offers Web3 and e-commerce services. Opera Limited was founded in 1995 and is headquartered in Oslo, Norway. Opera Limited is a subsidiary of Kunlun Tech Limited.

About Travelzoo

Travelzoo, together with its subsidiaries, operates as an Internet media company that provides travel, entertainment, and local experiences worldwide. It operates in four segments: Travelzoo North America, Travelzoo Europe, Jack's Flight Club, and New Initiatives. The company offers Travelzoo website, Travelzoo Top 20 email newsletters, Standalone email newsletters, Travelzoo Network, Travelzoo mobile applications, Jack's Flight Club website, Jack's Flight Club mobile applications, and Jack's Flight Club newsletters. The company's Travelzoo website and newsletters include local deals and getaways listings that allow members to purchase vouchers for offers from local businesses, such as spas, hotels, and restaurants; Jack's Flight Club, a subscription service that provides members with information about exceptional airfares; and Travelzoo Network, a network of third-party websites that list travel deals published by the company. It serves airlines, hotels, cruise lines, vacations packagers, tour operators, destinations, car rental companies, travel agents, theater and performing arts groups, restaurants, spas, and activity companies. Travelzoo Inc. was incorporated in 1998 and is headquartered in New York, New York.