Critical Analysis: HealthStream (NASDAQ:HSTM) and DeNA (OTCMKTS:DNACF)

DeNA (OTCMKTS:DNACF) and HealthStream (NASDAQ:HSTM) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, profitability and earnings.

Valuation & Earnings

This table compares DeNA and HealthStream”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DeNA	$981.17 million	1.99	$125.72 million	$1.19	13.45
HealthStream	$304.06 million	2.73	$18.34 million	$0.67	42.40

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

Institutional & Insider Ownership

69.6% of HealthStream shares are owned by institutional investors. 20.4% of HealthStream shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility and Risk

DeNA has a beta of -0.26, indicating that its stock price is 126% less volatile than the S&P 500. Comparatively, HealthStream has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500.

Profitability

This table compares DeNA and HealthStream’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DeNA	13.28%	7.33%	5.12%
HealthStream	6.39%	6.47%	4.44%

Analyst Ratings

This is a summary of recent ratings and price targets for DeNA and HealthStream, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DeNA	0	0	0	0	0.00
HealthStream	0	3	0	0	2.00

HealthStream has a consensus target price of $24.00, suggesting a potential downside of 15.52%. Given HealthStream’s stronger consensus rating and higher possible upside, analysts plainly believe HealthStream is more favorable than DeNA.

Summary

HealthStream beats DeNA on 7 of the 13 factors compared between the two stocks.

About DeNA

DeNA Co., Ltd. develops and operates mobile and online services worldwide. It operates Mobage, an entertainment platform; Yahoo! Mobage, which offers social games for PC browsers; AndApp, a platform that allows users to play mobile game apps on PC browsers under the same user account; Pococha, a social live streaming community; and IRIAM, an app which allows to livestream as an anime character. The company also operates SHOWROOM, a virtual stage where fans can watch their artists perform live while interacting with them in real time; MYCODE, a direct-to-consumer genetic testing service; kencom, which supports health insurance societies to manage their members’ health data; Haretoke, a web service which provides daily support for millennial women; Caradamo that offers diet support; and ONSEI, an app that uses AI to check for changes in cognitive function. In addition, it operates MENKYO, which enables cognitive function test for elderly drivers seeking license renewal; SHINRI-ADAS, a cognitive functional test; MRI-TAISEKI, a system that analyses brain DICOM images; Join, a communication app for medical professionals; MySOS, a life-saving and health support app with health and medical record for the user and their family; and DENA SPORTS GROUP, Yokohama DeNA Baystars, Kawasaki Brave Thunders, S.C.SAGAMIHARA, and DeNA Athletics Elite sports teams. Further, the company operates Mobaoku, which allows users to manage their auction items and bids from mobile phones; Anyca, a mobile app for peer-to-peer car sharing; SOMPO DE NORU, a car leasing service; GO, a taxi dispatch app; DRIVE CHART, an accident reduction support service; anone, a c ommunication service for seniors; dot-i, a security system; Coopel, a cloud robotic process automation service; PLAYBACK 9, a NFT service; Easy Ride, a robo-vehicle mobility service; Manga Box, a weekly manga magazine app; PICKFIVE, a NFT card game; and NFT collections. The company was incorporated in 1999 and is based in Tokyo, Japan.

About HealthStream

HealthStream, Inc. provides Software-as-a-Service (SaaS) based applications for healthcare organizations in the United States. The company’s solutions help healthcare organizations in meeting their ongoing clinical development, talent management, training, education, assessment, competency management, safety and compliance, and scheduling, as well as provider credentialing, privileging, and enrollment needs. It offers hStream, a technology platform that powers a range of healthcare workforce solutions. The company provides its solutions to customers across a range of entities within the healthcare industry, including private, not-for-profit, and government entities, as well as pharmaceutical and medical device companies through its direct sales teams. The company was incorporated in 1990 and is headquartered in Nashville, Tennessee.