E Commerce China Dangdang (NYSE: DANG) and Trade Desk (NASDAQ:TTD) are both small-cap technology companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Institutional & Insider Ownership

25.7% of E Commerce China Dangdang shares are owned by institutional investors. Comparatively, 65.5% of Trade Desk shares are owned by institutional investors. 26.9% of Trade Desk shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares E Commerce China Dangdang and Trade Desk’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
E Commerce China Dangdang N/A N/A N/A ($0.05) -132.60
Trade Desk $202.93 million 9.78 $20.48 million $1.02 47.35

Trade Desk has higher revenue and earnings than E Commerce China Dangdang. E Commerce China Dangdang is trading at a lower price-to-earnings ratio than Trade Desk, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for E Commerce China Dangdang and Trade Desk, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
E Commerce China Dangdang 0 0 0 0 N/A
Trade Desk 0 0 9 0 3.00

Trade Desk has a consensus target price of $65.78, suggesting a potential upside of 36.19%. Given Trade Desk’s higher possible upside, analysts plainly believe Trade Desk is more favorable than E Commerce China Dangdang.

Profitability

This table compares E Commerce China Dangdang and Trade Desk’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
E Commerce China Dangdang 8.34% 107.58% 17.19%
Trade Desk 15.93% 24.34% 8.38%

Summary

Trade Desk beats E Commerce China Dangdang on 7 of the 9 factors compared between the two stocks.

E Commerce China Dangdang Company Profile

E-Commerce China Dangdang Inc. is a business to consumer e-commerce company. The Company is focused on selling books online. The Company operates and manages its business in the segment of the provision of a single class of global services for the delivery of content and applications over the Internet. It offers over 1,200,000 book titles, including approximately 1,100,000 Chinese language titles. It offers other media products and general merchandise categories on its Internet platform, including fashion and apparel beauty and personal care products, home and lifestyle products, and baby, children and maternity products. It also offers the dangdang.com marketplace program, which allows third-party merchants to sell their general merchandise products alongside its products. Its Internet platform consists of its dangdang.com Website and its Dangdang mobile shopping application. Its Dangdang Reader application allows customers to browse for, download, purchase and read e-books.

Trade Desk Company Profile

The Trade Desk, Inc. is a technology company. The Company provides a self-service platform that enables clients to purchase and manage digital advertising campaigns across various advertising formats, including display, video and social, and on a range of devices, including computers, mobile devices and connected television. Its platform enables a media planner or buyer at an advertising agency to purchase digital media programmatically on various media exchanges and sell-side platforms; acquire and use third-party data to optimize and measure digital advertising campaigns; deploy their, or their client’s, own first-party data in order to optimize campaign efficacy; link digital campaigns to offline sales results or other business objectives; access other services, such as its data management platform and publisher management platform marketplace, and use its user interface and application programming interfaces (APIs) to build their own technology on top of the Company’s platform.

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