GDS (NASDAQ:GDS) and The Trade Desk (NASDAQ:TTD) are both large-cap business services companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, dividends, earnings, valuation, profitability, risk and institutional ownership.
Risk and Volatility
GDS has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, The Trade Desk has a beta of 2.51, suggesting that its share price is 151% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of current ratings for GDS and The Trade Desk, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| GDS | 0 | 2 | 6 | 0 | 2.75 |
| The Trade Desk | 0 | 5 | 14 | 0 | 2.74 |
GDS presently has a consensus target price of $103.4286, indicating a potential upside of 79.04%. The Trade Desk has a consensus target price of $79.5158, indicating a potential downside of 0.85%. Given GDS's stronger consensus rating and higher probable upside, equities research analysts clearly believe GDS is more favorable than The Trade Desk.
Earnings & Valuation
This table compares GDS and The Trade Desk's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| GDS | $879.54 million | 12.21 | $-97,380,000.00 | ($0.72) | -79.83 |
| The Trade Desk | $836.03 million | 45.85 | $242.32 million | $0.46 | 175.13 |
The Trade Desk has lower revenue, but higher earnings than GDS. GDS is trading at a lower price-to-earnings ratio than The Trade Desk, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares GDS and The Trade Desk's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| GDS | -14.32% | -5.18% | -1.93% |
| The Trade Desk | 26.91% | 25.57% | 10.09% |
Insider & Institutional Ownership
55.4% of GDS shares are held by institutional investors. Comparatively, 6.1% of The Trade Desk shares are held by institutional investors. 10.7% of The Trade Desk shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Summary
The Trade Desk beats GDS on 10 of the 14 factors compared between the two stocks.
