Contrasting GigaMedia (NASDAQ:GIGM) and Upwork (NASDAQ:UPWK)

GigaMedia (NASDAQ:GIGM) and Upwork (NASDAQ:UPWK) are both small-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, valuation, institutional ownership and risk.

Profitability

This table compares GigaMedia and Upwork’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GigaMedia	-43.58%	-3.85%	-3.64%
Upwork	14.65%	18.76%	9.03%

Volatility and Risk

GigaMedia has a beta of 0.43, indicating that its stock price is 57% less volatile than the S&P 500. Comparatively, Upwork has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for GigaMedia and Upwork, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GigaMedia	1	0	0	0	1.00
Upwork	0	6	7	0	2.54

Upwork has a consensus price target of $22.60, suggesting a potential upside of 107.91%. Given Upwork’s stronger consensus rating and higher probable upside, analysts plainly believe Upwork is more favorable than GigaMedia.

Institutional & Insider Ownership

13.5% of GigaMedia shares are held by institutional investors. Comparatively, 77.7% of Upwork shares are held by institutional investors. 1.0% of GigaMedia shares are held by company insiders. Comparatively, 7.5% of Upwork shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GigaMedia	$3.47 million	4.63	-$2.30 million	($0.11)	-13.23
Upwork	$787.78 million	1.80	$115.43 million	$0.84	12.94

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

Summary

Upwork beats GigaMedia on 13 of the 14 factors compared between the two stocks.

About GigaMedia

GigaMedia Limited, together with its subsidiaries, provides digital entertainment services in Taiwan, Hong Kong, and Macau. The company owns and operates FunTown, a digital entertainment portal that offers mobile and browser-based casual games, as well as provides services such as player clubs, tournaments, avatars, friends and family messenger and online chatting systems, customer service, mobile platform, and customer platform. It also offers MahJong, a traditional Chinese tile-based game; casual card and table games; online card games; and chance-based games, including bingo, lotto, horse racing, Sic-Bo, slots, and other casual games. In addition, the company provides role-playing and sports games, such as Tales Runner, a multi-player online obstacle running game; Yume 100, a story-based game that targets female players; Akaseka, a female-oriented game; and Shinobi Master New Link, a male-oriented game. GigaMedia Limited was founded in 1998 and is headquartered in Taipei, Taiwan.

About Upwork

Upwork Inc., together with its subsidiaries, operates a work marketplace that connects businesses with various independent professionals and agencies in the United States, India, the Philippines, and internationally. The company’s work marketplace provides access to talent with various skills across a range of categories, including administrative support, sales and marketing, design and creative, and customer service, as well as web, mobile, and software development. Its work marketplace also enables clients to streamline workflows, such as talent sourcing, outreach, and contracting. The company’s work marketplace offers access to various functionalities for remote engagements with talent, including communication and collaboration, ability to receive talent invoices through their work marketplace, and payment protection. Its marketplace offerings include Upwork Payroll and Upwork Enterprise, as well as managed and escrow services. The company was formerly known as Elance-oDesk, Inc. and changed its name to Upwork Inc. in May 2015. Upwork Inc. was incorporated in 2013 and is headquartered in San Francisco, California.