Head to Head Analysis: Travelzoo (NASDAQ:TZOO) versus Alphabet (NASDAQ:GOOGL)

Travelzoo (NASDAQ:TZOO) and Alphabet (NASDAQ:GOOGL) are both communication services companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, institutional ownership, analyst recommendations, risk and profitability.

Earnings and Valuation

This table compares Travelzoo and Alphabet”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Travelzoo	$91.72 million	0.64	$4.70 million	$0.03	190.67
Alphabet	$402.84 billion	10.72	$132.17 billion	$19.91	17.73

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

Volatility and Risk

Travelzoo has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500. Comparatively, Alphabet has a beta of 1.22, suggesting that its share price is 22% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Travelzoo and Alphabet, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Travelzoo	2	0	2	0	2.00
Alphabet	0	4	45	5	3.02

Travelzoo currently has a consensus target price of $13.83, suggesting a potential upside of 141.84%. Alphabet has a consensus target price of $422.16, suggesting a potential upside of 19.56%. Given Travelzoo’s higher possible upside, equities analysts clearly believe Travelzoo is more favorable than Alphabet.

Profitability

This table compares Travelzoo and Alphabet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Travelzoo	0.51%	-9.35%	1.00%
Alphabet	54.77%	51.32%	35.42%

Institutional & Insider Ownership

27.4% of Travelzoo shares are held by institutional investors. Comparatively, 40.0% of Alphabet shares are held by institutional investors. 45.3% of Travelzoo shares are held by insiders. Comparatively, 11.6% of Alphabet shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Alphabet beats Travelzoo on 11 of the 15 factors compared between the two stocks.

About Travelzoo

Travelzoo, together with its subsidiaries, operates as an Internet media company that provides travel, entertainment, and local experiences worldwide. It operates in four segments: Travelzoo North America, Travelzoo Europe, Jack's Flight Club, and New Initiatives. The company offers Travelzoo website, Travelzoo Top 20 email newsletters, Standalone email newsletters, Travelzoo Network, Travelzoo mobile applications, Jack's Flight Club website, Jack's Flight Club mobile applications, and Jack's Flight Club newsletters. The company's Travelzoo website and newsletters include local deals and getaways listings that allow members to purchase vouchers for offers from local businesses, such as spas, hotels, and restaurants; Jack's Flight Club, a subscription service that provides members with information about exceptional airfares; and Travelzoo Network, a network of third-party websites that list travel deals published by the company. It serves airlines, hotels, cruise lines, vacations packagers, tour operators, destinations, car rental companies, travel agents, theater and performing arts groups, restaurants, spas, and activity companies. Travelzoo Inc. was incorporated in 1998 and is headquartered in New York, New York.

About Alphabet

Alphabet Inc. offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. It is also involved in the sale of apps and in-app purchases and digital content in the Google Play and YouTube; and devices, as well as in the provision of YouTube consumer subscription services. The Google Cloud segment offers infrastructure, cybersecurity, databases, analytics, AI, and other services; Google Workspace that include cloud-based communication and collaboration tools for enterprises, such as Gmail, Docs, Drive, Calendar, and Meet; and other services for enterprise customers. The Other Bets segment sells healthcare-related and internet services. The company was incorporated in 1998 and is headquartered in Mountain View, California.