Reviewing The9 (NASDAQ:NCTY) and Constellation Software (OTCMKTS:CNSWF)

Constellation Software (OTCMKTS:CNSWF) and The9 (NASDAQ:NCTY) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.

Profitability

This table compares Constellation Software and The9’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Constellation Software	7.60%	47.37%	12.80%
The9	N/A	N/A	N/A

Insider and Institutional Ownership

0.5% of The9 shares are held by institutional investors. 30.8% of The9 shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Constellation Software and The9″s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Constellation Software	$11.62 billion	3.79	$512.00 million	$45.33	45.89
The9	$15.43 million	3.26	-$57.55 million	$6.00	0.55

Constellation Software has higher revenue and earnings than The9. The9 is trading at a lower price-to-earnings ratio than Constellation Software, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Constellation Software and The9, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Constellation Software	0	1	6	1	3.00
The9	1	0	0	0	1.00

Volatility and Risk

Constellation Software has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, The9 has a beta of 2.01, indicating that its stock price is 101% more volatile than the S&P 500.

Summary

Constellation Software beats The9 on 11 of the 14 factors compared between the two stocks.

About Constellation Software

Constellation Software Inc., together with its subsidiaries, acquires, builds, and manages vertical market software businesses in Canada, the United States, Europe, and internationally. It provides mission critical software solutions for public and private sector markets. The company is also involved in the software licensing; and sale of third-party hardware. In addition, it offers professional, and maintenance and other recurring services. Constellation Software Inc. was incorporated in 1995 and is headquartered in Toronto, Canada.

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.