Head-To-Head Survey: Golden Matrix Group (NASDAQ:GMGI) and Red Cat (NASDAQ:RCAT)

Golden Matrix Group (NASDAQ:GMGI) and Red Cat (NASDAQ:RCAT) are both small-cap consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, institutional ownership, dividends, analyst recommendations, valuation, profitability and earnings.

Institutional and Insider Ownership

2.7% of Golden Matrix Group shares are owned by institutional investors. Comparatively, 38.0% of Red Cat shares are owned by institutional investors. 23.2% of Golden Matrix Group shares are owned by insiders. Comparatively, 21.5% of Red Cat shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Golden Matrix Group and Red Cat’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golden Matrix Group	-3.07%	-3.93%	-2.11%
Red Cat	-232.62%	-96.00%	-75.95%

Valuation & Earnings

This table compares Golden Matrix Group and Red Cat”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golden Matrix Group	$44.17 million	5.98	N/A	N/A	N/A
Red Cat	$17.84 million	38.78	-$24.05 million	($0.54)	-15.98

Golden Matrix Group has higher revenue and earnings than Red Cat.

Risk & Volatility

Golden Matrix Group has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500. Comparatively, Red Cat has a beta of 1.32, indicating that its share price is 32% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Golden Matrix Group and Red Cat, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golden Matrix Group	0	0	0	0	0.00
Red Cat	0	0	1	0	3.00

Red Cat has a consensus price target of $4.00, indicating a potential downside of 53.65%. Given Red Cat’s stronger consensus rating and higher probable upside, analysts clearly believe Red Cat is more favorable than Golden Matrix Group.

Summary

Red Cat beats Golden Matrix Group on 6 of the 11 factors compared between the two stocks.

About Golden Matrix Group

Golden Matrix Group, Inc. provides enterprise software-as-a-service solutions for online casino and sports betting operators. The company develops and owns online gaming intellectual property; and builds gaming platforms for customers located primarily in the Asia Pacific region. Its platform facilitates gaming customers in operating online casinos, sportsbooks, lottery, and live games; and provides customers with access to a portfolio of licensed gaming content, which are provided by gaming content providers. The company also provides services and resells third party gaming content to licensed online gaming distributors. Its platform is accessed through desktop and mobile applications. The company was formerly known as Source Gold Corp. and changed its name to Golden Matrix Group, Inc. in April 2016. Golden Matrix Group, Inc. was incorporated in 2008 and is based in Las Vegas, Nevada.

About Red Cat

Red Cat Holdings, Inc. engages in the provision of various products, services, and solutions to the drone industry. The company operates through two segments: Enterprise and Consumer. It built infrastructure to manages drone fleets and fly, and provide services remotely, navigate confined industrial interior spaces and dangerous military environment. Red Cat Holdings, Inc. is based in San Juan, Puerto Rico.