Contrasting Advantage Solutions (NASDAQ:ADV) & iHeartMedia (NASDAQ:IHRT)

iHeartMedia (NASDAQ:IHRT) and Advantage Solutions (NASDAQ:ADV) are both small-cap communication services companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, risk, valuation, institutional ownership, profitability and dividends.

Analyst Recommendations

This is a summary of recent ratings for iHeartMedia and Advantage Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
iHeartMedia	2	1	0	0	1.33
Advantage Solutions	2	1	1	0	1.75

iHeartMedia presently has a consensus price target of $4.25, indicating a potential upside of 66.67%. Advantage Solutions has a consensus price target of $42.00, indicating a potential upside of 25.56%. Given iHeartMedia’s higher probable upside, research analysts clearly believe iHeartMedia is more favorable than Advantage Solutions.

Profitability

This table compares iHeartMedia and Advantage Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
iHeartMedia	-7.18%	N/A	-1.12%
Advantage Solutions	-7.65%	-48.15%	-9.47%

Earnings and Valuation

This table compares iHeartMedia and Advantage Solutions”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
iHeartMedia	$3.86 billion	0.10	-$472.87 million	($1.82)	-1.40
Advantage Solutions	$3.54 billion	0.12	-$227.74 million	($21.34)	-1.57

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

Risk and Volatility

iHeartMedia has a beta of 2.19, meaning that its stock price is 119% more volatile than the S&P 500. Comparatively, Advantage Solutions has a beta of 2.16, meaning that its stock price is 116% more volatile than the S&P 500.

Insider & Institutional Ownership

93.9% of iHeartMedia shares are owned by institutional investors. Comparatively, 49.8% of Advantage Solutions shares are owned by institutional investors. 10.2% of iHeartMedia shares are owned by company insiders. Comparatively, 9.7% of Advantage Solutions shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

iHeartMedia beats Advantage Solutions on 10 of the 14 factors compared between the two stocks.

About iHeartMedia

iHeartMedia, Inc. operates as an audio media company in the United States and internationally. It operates through three segments: Multiplatform Group, Digital Audio Group, and Audio & Media Services Group. The Multiplatform Group segment offers broadcast radio stations, sponsorship and events, and live and virtual events; and operates Premiere Networks, a national radio network that produces, distributes, or represents syndicated radio programs and services to radio station affiliates. It also delivers real-time traffic flow and incident information, and weather updates, sports, and news. The Digital Audio Group segment provides podcasting, digital sites, newsletters, digital services, and programs; and iHeartRadio, a mobile app and web based service for radio stations, digital only stations, custom artist stations, and podcasts. The Audio and Media Services Group segment engages in the media representation business; and provides scheduling and broadcast software and services. This segment also provides RCS, a cloud and on-premises broadcast software, such as radio and television automation, music scheduling, newsroom automation, advertising sales management, disaster recovery solutions; and real-time audio recognition technology to radio and television stations, cable channels, record labels, advertisers, and agencies, as well as media streaming and research services. The company was formerly known as CC Media Holdings, Inc. and changed its name to iHeartMedia, Inc. in September 2014. The company is headquartered in San Antonio, Texas.

About Advantage Solutions

Advantage Solutions Inc. provides business solutions to consumer goods manufacturers and retailers in North America and internationally. It operates in two segments, Sales and Marketing. The Sales segment offers brand-centric services, such as headquarter relationship management; analytics, insights, and intelligence; and brand-centric merchandising services. This segment also provides retailer-centric services comprising retailer-centric merchandising and in-store media services. The Marketing segment offers brand-centric services, including shopper and consumer marketing, and brand experiential services; retailer-centric services, such as retail experiential and private label services; and digital marketing, and digital media and advertising services. The company was formerly known as Karman Holding Corp. and changed its name to Advantage Solutions Inc. in March 2016. The company was founded in 1987 and is headquartered in Irvine, California.