Versant (NASDAQ:VSNT – Get Free Report) and Direct Digital (NASDAQ:DRCT – Get Free Report) are both communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, analyst recommendations, dividends, earnings and profitability.
Valuation and Earnings
This table compares Versant and Direct Digital”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Versant | $6.54 billion | 0.75 | $930.00 million | $3.82 | 9.40 |
| Direct Digital | $30.91 million | 0.00 | -$18.95 million | ($156.85) | -0.00 |
Versant has higher revenue and earnings than Direct Digital. Direct Digital is trading at a lower price-to-earnings ratio than Versant, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
4.0% of Direct Digital shares are held by institutional investors. 0.1% of Versant shares are held by insiders. Comparatively, 25.6% of Direct Digital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Analyst Ratings
This is a summary of current ratings and recommmendations for Versant and Direct Digital, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Versant | 1 | 6 | 2 | 1 | 2.30 |
| Direct Digital | 1 | 0 | 0 | 0 | 1.00 |
Versant currently has a consensus price target of $41.71, indicating a potential upside of 16.14%. Given Versant’s stronger consensus rating and higher possible upside, research analysts plainly believe Versant is more favorable than Direct Digital.
Profitability
This table compares Versant and Direct Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Versant | 11.09% | 8.32% | 5.78% |
| Direct Digital | -74.38% | N/A | -68.48% |
Summary
Versant beats Direct Digital on 12 of the 14 factors compared between the two stocks.
About Versant
Versant is a media and entertainment company formed from Comcast’s separation of several NBCUniversal cable networks and digital businesses. Its portfolio includes news brands CNBC and MS NOW, along with entertainment and sports networks such as USA Network, Syfy, E!, Oxygen and Golf Channel. The company also operates digital and consumer services including Fandango, Rotten Tomatoes, GolfNow and SportsEngine. Through its television networks and online platforms, Versant serves audiences primarily in the United States, with some brands and services reaching international markets.
About Direct Digital
Direct Digital Holdings, Inc. is an advertising technology company that provides digital marketing and programmatic advertising solutions to advertisers, agencies, publishers and media owners. The company helps clients plan, execute and optimize campaigns across channels such as display, mobile, connected television, audio and other digital formats. Direct Digital operates through two primary businesses. Huddled Masses Media is its buy-side platform, providing campaign management, audience targeting, media buying and optimization services for advertisers and agencies.
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