Loyalty Ventures (NASDAQ:LYLT – Get Rating) and Digital Media Solutions (NYSE:DMS – Get Rating) are both small-cap business services companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.
Earnings and Valuation
This table compares Loyalty Ventures and Digital Media Solutions’ revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Loyalty Ventures | $735.31 million | 0.35 | -$2.34 million | N/A | N/A |
| Digital Media Solutions | $427.93 million | 0.20 | $2.20 million | ($0.04) | -34.00 |
Digital Media Solutions has lower revenue, but higher earnings than Loyalty Ventures.
Institutional & Insider Ownership
77.3% of Loyalty Ventures shares are held by institutional investors. Comparatively, 2.3% of Digital Media Solutions shares are held by institutional investors. 0.2% of Loyalty Ventures shares are held by company insiders. Comparatively, 87.7% of Digital Media Solutions shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Loyalty Ventures and Digital Media Solutions’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Loyalty Ventures | N/A | N/A | N/A |
| Digital Media Solutions | -0.28% | -3.09% | -2.30% |
Analyst Recommendations
This is a breakdown of current ratings and price targets for Loyalty Ventures and Digital Media Solutions, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Loyalty Ventures | 0 | 1 | 1 | 0 | 2.50 |
| Digital Media Solutions | 0 | 1 | 3 | 0 | 2.75 |
Loyalty Ventures currently has a consensus price target of $20.00, suggesting a potential upside of 90.29%. Digital Media Solutions has a consensus price target of $11.50, suggesting a potential upside of 745.59%. Given Digital Media Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Digital Media Solutions is more favorable than Loyalty Ventures.
Summary
Loyalty Ventures beats Digital Media Solutions on 6 of the 11 factors compared between the two stocks.
About Loyalty Ventures (Get Rating)
Loyalty Ventures Inc. provides consumer loyalty solutions. The company owns and operates the AIR MILES Reward Program, an end-to-end loyalty platform; and BrandLoyalty, a campaign-based loyalty solution for grocers and other high-frequency retailers. It also offers marketing, customer, and rewards and redemption management services for sponsors. The company helps financial services providers, retailers, and other consumer-facing businesses to create and increase customer loyalty across various touchpoints. Loyalty Ventures Inc. was incorporated in 2021 and is based in Plano, Texas.
About Digital Media Solutions (Get Rating)
Digital Media Solutions, Inc. operates as a digital performance marketing company that offers a software delivery platform in the United States. It operates through three segments: Brand Direct, Marketplace, and Other. The company operates as a performance marketing engine for companies across various industries, including consumer finance, e-commerce, education, insurance, home services, brand performance, automotive, gig, health and wellness, and career placements. It also provides managed services that help clients to access and control the advertising expenses; and marketing automation software as a service to clients. The company was founded in 2012 and is headquartered in Clearwater, Florida.
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Loyalty Ventures (NASDAQ:LYLT) versus Digital Media Solutions (NYSE:DMS) Financial Comparison