Nexxen International (NASDAQ:NEXN – Get Free Report) and DigitalOcean (NASDAQ:DOCN – Get Free Report) are both business services companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, dividends, analyst recommendations, risk, institutional ownership, earnings and valuation.
Institutional and Insider Ownership
54.2% of Nexxen International shares are held by institutional investors. Comparatively, 49.8% of DigitalOcean shares are held by institutional investors. 0.7% of DigitalOcean shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Risk & Volatility
Nexxen International has a beta of 1.83, meaning that its stock price is 83% more volatile than the S&P 500. Comparatively, DigitalOcean has a beta of 1.81, meaning that its stock price is 81% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Nexxen International | 0 | 1 | 3 | 0 | 2.75 |
| DigitalOcean | 1 | 5 | 5 | 0 | 2.36 |
Nexxen International presently has a consensus target price of $7.88, indicating a potential upside of 31.69%. DigitalOcean has a consensus target price of $38.00, indicating a potential upside of 9.10%. Given Nexxen International’s stronger consensus rating and higher probable upside, research analysts plainly believe Nexxen International is more favorable than DigitalOcean.
Profitability
This table compares Nexxen International and DigitalOcean’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Nexxen International | -3.12% | 4.86% | 2.96% |
| DigitalOcean | 7.01% | -26.29% | 5.49% |
Earnings and Valuation
This table compares Nexxen International and DigitalOcean’s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Nexxen International | $334.69 million | 1.24 | -$21.49 million | ($0.13) | -46.00 |
| DigitalOcean | $692.88 million | 4.58 | $19.41 million | $0.53 | 65.72 |
DigitalOcean has higher revenue and earnings than Nexxen International. Nexxen International is trading at a lower price-to-earnings ratio than DigitalOcean, indicating that it is currently the more affordable of the two stocks.
Summary
DigitalOcean beats Nexxen International on 9 of the 14 factors compared between the two stocks.
About Nexxen International
Nexxen International Ltd. provides end-to-end software platform that enables advertisers to reach publishers Israel. The company's demand side platform (DSP) offers full-service and self-managed marketplace access to advertisers and agencies to execute their digital marketing campaigns in real time across various ad formats. Its sell supply side platform (SSP) provides access to data and a comprehensive product suite to drive inventory management and revenue optimization. The company also offers data management platform solution, which integrates DSP and SSP solutions enabling advertisers and publishers to use data from various sources in order to optimize results of their advertising campaigns. It serves ad buyers, advertisers, brands, agencies, and digital publishers in the United States, the Asia-Pacific, Europe, the Middle East, and Africa. The company was formerly known as Tremor International Ltd and changed its name to Nexxen International Ltd. in January 2024. Nexxen International Ltd. was incorporated in 2007 and is headquartered in Tel Aviv-Yafo, Israel.
About DigitalOcean
DigitalOcean Holdings, Inc., through its subsidiaries, operates a cloud computing platform in North America, Europe, Asia, and internationally. The company's platform provides on-demand infrastructure and platform tools for developers, start-ups, and small and growing digital businesses. It also offers infrastructure-as-a-service (IaaS) solutions comprising compute and storage services, as well as networking projects, including Cloud Firewalls software, Managed Load Balancers software, and Virtual Private Cloud (VPC). The company also provides platform-as-a-service (PaaS) solutions, such as managed databases; managed Kubernetes and container registry; application platform to build, deploy, and scale applications; Functions, a serverless compute solution; and Uptime for real-time uptime and latency alerts, as well as software-as-a-service (SaaS), including managed hosting and DigitalOcean Marketplace, a platform where developers can find pre-configured applications and solutions. In addition, it offers artificial intelligence (AI)/machine learning (ML) applications comprising GPU virtual machines for scaling AI applications; Notebooks, a simple cloud workspace that runs on GPUs that provides a managed interactive development environment for exploring data, and training and building machine learning models; and Deployments for deploying their machine learning model as an API endpoint. The company's customers include software engineers, researchers, data scientists, system administrators, students, and hobbyists. Its customers use its platform in various industry verticals and for a range of use cases, such as web and mobile applications, website hosting, e-commerce, media and gaming, personal web projects, managed services, and AI/ML applications. DigitalOcean Holdings, Inc. was incorporated in 2012 and is headquartered in New York, New York.
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