Head to Head Analysis: Bitfarms (NASDAQ:BITF) and The9 (NASDAQ:NCTY)

The9 (NASDAQ:NCTY) and Bitfarms (NASDAQ:BITF) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, analyst recommendations, risk, institutional ownership, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent ratings for The9 and Bitfarms, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
The9	0	0	0	0	0.00
Bitfarms	0	1	6	0	2.86

Bitfarms has a consensus target price of $4.05, indicating a potential upside of 268.18%. Given Bitfarms’ stronger consensus rating and higher possible upside, analysts clearly believe Bitfarms is more favorable than The9.

Profitability

This table compares The9 and Bitfarms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
The9	N/A	N/A	N/A
Bitfarms	-69.08%	-22.17%	-18.93%

Volatility and Risk

The9 has a beta of 2.08, meaning that its stock price is 108% more volatile than the S&P 500. Comparatively, Bitfarms has a beta of 3.68, meaning that its stock price is 268% more volatile than the S&P 500.

Earnings and Valuation

This table compares The9 and Bitfarms”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
The9	$176.49 million	0.60	$2.82 million	N/A	N/A
Bitfarms	$182.96 million	2.88	-$104.04 million	($0.36)	-3.06

The9 has higher earnings, but lower revenue than Bitfarms.

Institutional and Insider Ownership

0.5% of The9 shares are held by institutional investors. Comparatively, 20.6% of Bitfarms shares are held by institutional investors. 30.8% of The9 shares are held by insiders. Comparatively, 9.5% of Bitfarms shares are held 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.

Summary

Bitfarms beats The9 on 7 of the 12 factors compared between the two stocks.

About The9

The9 Limited operates as a cryptocurrency mining business in China, Eastern Europe, Asia, and North America. The company was formerly known as GameNow.net Limited and changed its name to The9 Limited in February 2004. The9 Limited was incorporated in 1999 and is headquartered in Shanghai, the People’s Republic of China.

About Bitfarms

Bitfarms Ltd. engages in the mining of cryptocurrency coins and tokens in Canada, the United States, Paraguay, and Argentina. It owns and operates server farms that primarily validates transactions on the Bitcoin Blockchain and earning cryptocurrency from block rewards and transaction fees. The company also provides electrician services to commercial and residential customers in Quebec, Canada. It also undertakes hosting of third-party mining hardware. The company was founded in 2017 and is based in Toronto, Canada.