Financial Analysis: ZipRecruiter (NYSE:ZIP) & MediaAlpha (NYSE:MAX)

ZipRecruiter (NYSE:ZIP) and MediaAlpha (NYSE:MAX) are both small-cap communication services companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, dividends, risk, institutional ownership, valuation, earnings and analyst recommendations.

Institutional & Insider Ownership

70.6% of ZipRecruiter shares are held by institutional investors. Comparatively, 64.4% of MediaAlpha shares are held by institutional investors. 19.9% of ZipRecruiter shares are held by insiders. Comparatively, 14.6% of MediaAlpha shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares ZipRecruiter and MediaAlpha”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ZipRecruiter	$448.95 million	0.68	-$32.99 million	$0.35	10.67
MediaAlpha	$1.11 billion	0.64	$25.62 million	$1.62	7.19

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

Profitability

This table compares ZipRecruiter and MediaAlpha’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ZipRecruiter	6.20%	N/A	-3.73%
MediaAlpha	7.94%	-301.42%	28.23%

Analyst Ratings

This is a breakdown of current recommendations for ZipRecruiter and MediaAlpha, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ZipRecruiter	0	4	0	0	2.00
MediaAlpha	0	5	3	1	2.56

ZipRecruiter currently has a consensus target price of $4.17, indicating a potential upside of 11.56%. MediaAlpha has a consensus target price of $14.29, indicating a potential upside of 22.62%. Given MediaAlpha’s stronger consensus rating and higher probable upside, analysts plainly believe MediaAlpha is more favorable than ZipRecruiter.

Volatility and Risk

ZipRecruiter has a beta of 1.44, meaning that its stock price is 44% more volatile than the S&P 500. Comparatively, MediaAlpha has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.

Summary

MediaAlpha beats ZipRecruiter on 9 of the 15 factors compared between the two stocks.

About ZipRecruiter

ZipRecruiter, Inc. operates an online employment marketplace that connects job seekers and employers. Its platform provides various solutions, such as job posting, online interviews, job alerts, match scores, and application updates. The company was incorporated in 2010 and is based in Santa Monica, California.

About MediaAlpha

MediaAlpha, Inc., through its subsidiaries, operates an insurance customer acquisition platform in the United States. It optimizes customer acquisition in various verticals of property and casualty insurance, health insurance, and life insurance. The company was founded in 2014 and is headquartered in Los Angeles, California.