Millennial Media (NYSE: MM) and Tremor Video (NYSE:TRMR) are both small-cap cyclical consumer goods & services companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.

Profitability

This table compares Millennial Media and Tremor Video’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Millennial Media -23.47% -26.25% -19.24%
Tremor Video -7.11% -16.72% -8.96%

Valuation and Earnings

This table compares Millennial Media and Tremor Video’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Millennial Media N/A N/A N/A N/A N/A
Tremor Video $185.36 million 0.89 -$1.96 million ($0.27) -12.04

Millennial Media has higher revenue, but lower earnings than Tremor Video.

Institutional & Insider Ownership

39.7% of Tremor Video shares are owned by institutional investors. 8.2% of Tremor Video shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for Millennial Media and Tremor Video, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Millennial Media 0 0 0 0 N/A
Tremor Video 0 1 2 0 2.67

Tremor Video has a consensus target price of $3.63, indicating a potential upside of 11.54%. Given Tremor Video’s higher probable upside, analysts plainly believe Tremor Video is more favorable than Millennial Media.

Summary

Tremor Video beats Millennial Media on 8 of the 8 factors compared between the two stocks.

Millennial Media Company Profile

Millennial Media, Inc. is an independent mobile advertising marketplace delivering products and services to advertisers and developers. The Company offers advertisers a suite of solutions that allow them to reach and connect with the target audiences across screens, from smartphones, tablets and other mobile devices to PCs. The Company offers developers the ability to maximize the advertising revenue and acquire new users for apps. Its advertiser and developer solutions support all mobile operating systems, including Apple iOS, Android, Windows Phone and BlackBerry. For clients who want a higher degree of customer service, the Company offers its managed media services with dedicated account teams. For its clients who want to interact with it on a more automated basis, the Company offers tools that allow advertisers to buy its ad supply in a programmatic fashion through its ad exchange and developers the opportunity to manage and monetize the ad inventory through its supply side tool.

Tremor Video Company Profile

Tremor Video, Inc. is an advertising technology company. The Company provides software for video advertising effectiveness. The Company operates through online video advertising services segment. Its technology optimizes performance of video advertisement campaigns across all screens, including computers, smartphones, tablets and connected televisions. The Company’s buyer platform enables advertisers, agencies and other buyers of advertising to discover, buy, optimize and measure the effectiveness of their video advertisement campaigns. The Company’s technology analyzes video content, detects viewer and system attributes, and uses its repository of stored third-party data to optimize and target the delivery of advertisement campaigns. Its buyers can transact directly on its buyer platform through the Tremor Video DSP, a user interface that allows them to manage the execution of their campaigns on a programmatic basis. The Company also offers a seller platform, the Tremor Video SSP.

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