Match Group (NASDAQ:MTCH) vs. System1 (NYSE:SST) Financial Review

Match Group (NASDAQ:MTCH) and System1 (NYSE:SST) are both communication services companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Volatility & Risk

Match Group has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500. Comparatively, System1 has a beta of 1.69, meaning that its stock price is 69% more volatile than the S&P 500.

Profitability

This table compares Match Group and System1’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Match Group	20.69%	-361.92%	17.95%
System1	-50.66%	-439.90%	-19.35%

Earnings and Valuation

This table compares Match Group and System1″s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Match Group	$3.49 billion	2.58	$613.45 million	$2.94	13.32
System1	$180.94 million	0.10	-$65.35 million	($11.31)	-0.16

Match Group has higher revenue and earnings than System1. System1 is trading at a lower price-to-earnings ratio than Match Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Match Group pays an annual dividend of $0.80 per share and has a dividend yield of 2.0%. System1 pays an annual dividend of $0.32 per share and has a dividend yield of 18.0%. Match Group pays out 27.2% of its earnings in the form of a dividend. System1 pays out -2.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. System1 is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of current recommendations and price targets for Match Group and System1, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Match Group	0	9	9	0	2.50
System1	1	1	1	0	2.00

Match Group currently has a consensus price target of $45.64, indicating a potential upside of 16.55%. System1 has a consensus price target of $6.50, indicating a potential upside of 267.23%. Given System1’s higher probable upside, analysts clearly believe System1 is more favorable than Match Group.

Institutional and Insider Ownership

94.1% of Match Group shares are owned by institutional investors. Comparatively, 87.5% of System1 shares are owned by institutional investors. 0.7% of Match Group shares are owned by company insiders. Comparatively, 10.2% of System1 shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Match Group beats System1 on 11 of the 16 factors compared between the two stocks.

About Match Group

Match Group, Inc. engages in the provision of dating products. Its portfolio of brands includes Tinder, Hinge, Match, Meetic, OkCupid, Pairs, Plenty Of Fish, Azar, BLK, and Hakuna, as well as a various other brands, each built to increase users' likelihood of connecting with others. Its services are available in over 40 languages to users worldwide. The company was incorporated in 1986 and is based in Dallas, Texas.

About System1

System1, Inc. provides omnichannel customer acquisition platform services through its proprietary responsive acquisition marketing platform in the United States, the United Kingdom, Canada, the Netherlands, and internationally. It operates through two segments: Owned and Operated Advertising, and Partner Network. The company engages in the provision of acquiring traffic to its owned and operated websites, as well as revenue-sharing arrangements and related services. It also operates MapQuest, a web-based navigation service that delivers turn-by-turn direction services to users; Info.com, a metasearch engine that consumers can use to search for relevant information; HowStuffWorks, a commercial website focused on helping people solve problems in their daily lives by using various types of digital media to easily breakdown and explain complex concepts, topics, terminology and mechanisms; Startpage, a private search engine that allows users to browse and search the Internet in complete privacy; and CouponFollow for coupon destinations for online shoppers, as well as ActiveBeat and Infospace. In addition, the company provides antivirus software solutions, which offers customers a single packaged solution that provides protection and reporting to the end users. The company is based in Los Angeles, California.