Financial Analysis: Alphabet (GOOGL) & Autoweb (AUTO)

Alphabet (NASDAQ:GOOGL) and Autoweb (NASDAQ:AUTO) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Alphabet and Autoweb, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alphabet 0 1 28 0 2.97
Autoweb 0 3 0 0 2.00

Alphabet currently has a consensus target price of $1,338.89, indicating a potential upside of 21.45%. Autoweb has a consensus target price of $4.60, indicating a potential upside of 28.49%. Given Autoweb’s higher possible upside, analysts clearly believe Autoweb is more favorable than Alphabet.

Earnings and Valuation

This table compares Alphabet and Autoweb’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alphabet $136.82 billion 5.61 $12.66 billion $47.51 23.20
Autoweb $142.13 million 0.33 -$64.96 million $0.29 12.34

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

Institutional and Insider Ownership

33.4% of Alphabet shares are held by institutional investors. Comparatively, 32.4% of Autoweb shares are held by institutional investors. 13.2% of Alphabet shares are held by insiders. Comparatively, 30.6% of Autoweb shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Alphabet and Autoweb’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alphabet 22.47% 19.94% 15.31%
Autoweb -78.46% -20.99% -15.13%

Volatility and Risk

Alphabet has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, Autoweb has a beta of 0.13, suggesting that its stock price is 87% less volatile than the S&P 500.

Summary

Alphabet beats Autoweb on 12 of the 14 factors compared between the two stocks.

About Alphabet

Alphabet Inc., through its subsidiaries, provides online advertising services in the United States and internationally. The company offers performance and brand advertising services. It operates through Google and Other Bets segments. The Google segment includes principal Internet products, such as Ads, Android, Chrome, Commerce, Google Cloud, Google Maps, Google Play, Hardware, Search, and YouTube, as well as technical infrastructure and newer efforts, including Virtual Reality. This segment also offers digital content, enterprise cloud services, and hardware products, as well as other miscellaneous products and services. The Other Bets segment includes businesses, such as Access, Calico, CapitalG, GV, Nest, Verily, Waymo, and X, as well as fiber Internet and Television services. Alphabet Inc. was founded in 1998 and is headquartered in Mountain View, California.

About Autoweb

AutoWeb, Inc. operates as a digital marketing company for the automotive industry in the United States. It assists automotive retail dealers and manufacturers to market and sell new and used vehicles to consumers through its programs. The company's products include new vehicle lead program, which allows consumers to submit requests for pricing and availability of specific makes and models; and used vehicle lead program, which allows consumers to search for used vehicles according to search parameters, such as price, make, model, mileage, year, and location of the vehicle. The company's products and services also comprise WebLeads+ that offers various coupon options, which display marketing messages to consumers visiting the dealer's Website; and Payment Pro, a dealer Website conversion tool that offers consumers real-time online monthly payment information, as well as sells fixed placement advertising across its Website to automotive advertisers. It owns and operates automotive Websites that offers consumers with the information and tools to aid them with their automotive purchase decisions; an automotive search engine that enables manufactures and dealers to optimize advertising campaigns; AutoWeb Traffic Product, a pay-per-click advertising program that offer targeted offers to consumers based on make, model, and geographic location; and AutoWeb consumer traffic referral product that engages car buyers from the AutoWeb's network of automotive Websites to present them with offers based on their make and model of interest, as well as geographic location. The company was formerly known as Autobytel Inc. and changed its name to AutoWeb, Inc. in October 2017. AutoWeb, Inc. was founded in 1995 and is headquartered in Irvine, California.

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