Critical Contrast: Brightcove (NASDAQ:BCOV) and Trivago (NASDAQ:TRVG)

Brightcove (NASDAQ:BCOV) and Trivago (NASDAQ:TRVG) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.

Earnings & Valuation

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brightcove $164.83 million 2.04 -$14.03 million ($0.27) -32.11
Trivago $1.07 billion 0.85 -$25.38 million ($0.07) -37.29

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

Profitability

This table compares Brightcove and Trivago’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brightcove -10.02% -7.81% -3.56%
Trivago 3.13% 2.94% 2.31%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Brightcove and Trivago, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brightcove 0 0 2 0 3.00
Trivago 0 3 1 0 2.25

Brightcove presently has a consensus price target of $14.00, suggesting a potential upside of 61.48%. Trivago has a consensus price target of $4.53, suggesting a potential upside of 73.37%. Given Trivago’s higher possible upside, analysts clearly believe Trivago is more favorable than Brightcove.

Institutional & Insider Ownership

77.8% of Brightcove shares are held by institutional investors. Comparatively, 11.5% of Trivago shares are held by institutional investors. 1.9% of Brightcove shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Brightcove has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, Trivago has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500.

About Brightcove

Brightcove Inc. provides cloud-based services for video. It offers Video Cloud, an online video platform that enables its customers to publish and distribute video to Internet-connected devices. The company also provides Zencoder, a cloud-based video encoding service for file support, quality and control, speed and reliability, platform and security, and account and integration; SSAI, a cloud-based ad insertion and video stitching service; and Player, a cloud-based service for creating and managing video player experiences. In addition, it offers Video Marketing Suite, a suite of video technologies to address the needs of marketers to drive awareness, engagement, and conversion; OTT Flow, a service for media companies and content owners to deploy direct-to-consumer, live and on-demand video services across platforms; and Enterprise video suite, an enterprise-class platform for internal communications, employee training, live streaming, marketing, and e-commerce videos. Further, the company provides account management, professional, support, and online and onsite training services. It serves media companies, broadcasters, publishers, sports and entertainment companies, fashion and hospitality brands and corporations, faith-based institutions, e-commerce platforms, and hi-tech organizations; and governments, educational institutions, and non-profit organizations through direct sales, referral partners, channel partners, and resellers in North America, Europe, Japan, the Asia Pacific, and internationally, as well as sells its products online. The company was formerly known as Video Marketplace, Inc. and changed its name to Brightcove Inc. in March 2005. Brightcove Inc. was founded in 2004 and is headquartered in Boston, Massachusetts.

About Trivago

trivago N.V., together with its subsidiaries, operates as a hotel and accommodation search platform. It offers online meta-search for hotels by facilitating consumers' search for hotel accommodation through online travel agents, hotel chains, and independent hotels. The company provides access to its platform through 55 localized Websites and apps in 33 languages. As of December 31, 2018, its hotel search platform offered access to approximately 3.0 million hotels and other types of accommodation worldwide. The company was founded in 2005 and is headquartered in Düsseldorf, Germany. trivago N.V. is a subsidiary of Expedia Group, Inc.

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