PubMatic (NASDAQ:PUBM – Get Free Report) and Pinterest (NYSE:PINS – Get Free Report) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.
Profitability
This table compares PubMatic and Pinterest’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| PubMatic | 5.96% | 6.12% | 2.58% |
| 6.21% | 8.37% | 7.11% |
Insider and Institutional Ownership
64.3% of PubMatic shares are held by institutional investors. Comparatively, 88.8% of Pinterest shares are held by institutional investors. 2.9% of PubMatic shares are held by company insiders. Comparatively, 7.1% of Pinterest shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
Analyst Recommendations
This is a summary of recent recommendations for PubMatic and Pinterest, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| PubMatic | 0 | 3 | 5 | 0 | 2.63 |
| 0 | 7 | 20 | 1 | 2.79 |
PubMatic presently has a consensus target price of $21.71, suggesting a potential upside of 29.02%. Pinterest has a consensus target price of $41.65, suggesting a potential upside of 36.93%. Given Pinterest’s stronger consensus rating and higher probable upside, analysts plainly believe Pinterest is more favorable than PubMatic.
Earnings and Valuation
This table compares PubMatic and Pinterest”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| PubMatic | $290.35 million | 2.77 | $8.88 million | $0.31 | 54.29 |
| $3.06 billion | 6.73 | -$35.61 million | $0.30 | 101.40 |
PubMatic has higher earnings, but lower revenue than Pinterest. PubMatic is trading at a lower price-to-earnings ratio than Pinterest, indicating that it is currently the more affordable of the two stocks.
Summary
Pinterest beats PubMatic on 12 of the 15 factors compared between the two stocks.
About PubMatic
PubMatic, Inc., a technology company, engages in the provision of a cloud infrastructure platform that enables real-time programmatic advertising transactions for digital content creators, advertisers, agencies, agency trading desks, and demand side platforms worldwide. Its PubMatic SSP, a sell-side platform, used for the purchase and sale of digital advertising inventory for publishers and buyers. The company also provides solutions, including OpenWrap, a header bidding solution; Openwrap OTT, a prebid-powered unified bidding solution; Openwrap SDK, an enterprise-grade management tools and analytics; Connect, a solution that provides additional data and insights to publishers and buyers; Activate, which allows buyers to execute direct deals on its platform across publisher inventory; Convert, a commerce media solution; and Identity Hub, an ID management tool for publishers that leverages specialized technology?infrastructure?to simplify the complex alternative identifier marketplace. Its platform supports an array of ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top (OTT), connected television, and media. The company was incorporated in 2006 and is based in Redwood City, California.
About Pinterest
Pinterest, Inc. operates as a visual search and discovery platform in the United States and internationally. Its platform allows people to find ideas, such as recipes, home and style inspiration, and others; and to search, save, and shop the ideas. The company was formerly known as Cold Brew Labs Inc. and changed its name to Pinterest, Inc. in April 2012. Pinterest, Inc. was incorporated in 2008 and is headquartered in San Francisco, California.
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