Square Enix (OTCMKTS:SQNXF) and Reddit (NYSE:RDDT) Critical Survey

Square Enix (OTCMKTS:SQNXF) and Reddit (NYSE:RDDT) are both communication services companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, valuation, dividends and earnings.

Earnings and Valuation

This table compares Square Enix and Reddit”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Square Enix	$1.98 billion	3.33	$195.47 million	$0.75	24.33
Reddit	$2.20 billion	13.47	$529.72 million	$4.30	35.86

Reddit has higher revenue and earnings than Square Enix. Square Enix is trading at a lower price-to-earnings ratio than Reddit, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Square Enix and Reddit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Square Enix	N/A	N/A	N/A
Reddit	31.35%	29.02%	26.32%

Analyst Ratings

This is a breakdown of recent ratings for Square Enix and Reddit, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Square Enix	0	0	0	1	4.00
Reddit	0	11	18	2	2.71

Reddit has a consensus price target of $221.10, indicating a potential upside of 43.40%. Given Reddit’s higher probable upside, analysts plainly believe Reddit is more favorable than Square Enix.

Volatility & Risk

Square Enix has a beta of 0.5, indicating that its share price is 50% less volatile than the S&P 500. Comparatively, Reddit has a beta of 2.02, indicating that its share price is 102% more volatile than the S&P 500.

Summary

Reddit beats Square Enix on 12 of the 13 factors compared between the two stocks.

About Square Enix

Square Enix Holdings Co., Ltd. operates in the content and service businesses in Japan and internationally. It operates through Digital Entertainment Business, Amusement Business, Publishing Business, and Rights Property Business. The company plans, develops, sells, and manages digital entertainment content primarily in the form of computer games. It is also involved in the operation of amusement facilities; and planning, development, manufacture, sale, and rental of arcade game machines and related products for amusement facilities. In addition, the company publishes and licenses comic books, magazines, game-related books, periodicals, etc. Further, it plans, produces, distributes, and licenses secondary works; and offers content under the SQUARE ENIX PRODUCTS brand; and stuffed toys and utility goods under the SQEX TOYS brand. The company was incorporated in 1975 and is headquartered in Tokyo, Japan.

About Reddit

Reddit, Inc. operates a website that organizes digital communities. It organizes communities based on specific interests that enable users to engage in conversations by sharing experiences, submitting links, uploading images and videos, and replying to one another. The company was founded in 2005 and is headquartered in San Francisco, California.