Financial Review: Red Violet (NASDAQ:RDVT) versus Datasea (NASDAQ:DTSS)

Red Violet (NASDAQ:RDVT) and Datasea (NASDAQ:DTSS) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.

Analyst Ratings

This is a summary of current ratings and price targets for Red Violet and Datasea, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Violet	0	0	1	0	3.00
Datasea	0	0	0	0	0.00

Red Violet presently has a consensus price target of $25.00, indicating a potential downside of 34.59%. Given Red Violet’s stronger consensus rating and higher probable upside, analysts plainly believe Red Violet is more favorable than Datasea.

Risk & Volatility

Red Violet has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Datasea has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500.

Profitability

This table compares Red Violet and Datasea’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Red Violet	7.17%	6.80%	6.28%
Datasea	-34.88%	-713.09%	-272.21%

Valuation & Earnings

This table compares Red Violet and Datasea”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Red Violet	$60.20 million	8.76	$13.53 million	$0.36	106.17
Datasea	$23.98 million	0.71	-$11.38 million	N/A	N/A

Red Violet has higher revenue and earnings than Datasea.

Insider and Institutional Ownership

63.6% of Red Violet shares are held by institutional investors. Comparatively, 82.1% of Datasea shares are held by institutional investors. 9.5% of Red Violet shares are held by company insiders. Comparatively, 41.1% of Datasea shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Red Violet beats Datasea on 10 of the 12 factors compared between the two stocks.

About Red Violet

Red Violet, Inc., a software and services company, specializes in proprietary technologies and applying analytical capabilities to deliver identity intelligence in the United States. It offers idiCORE, an investigative solution used to address various organizational challenges, which include due diligence, risk mitigation, identity authentication, fraud detection and prevention, customer acquisition, and regulatory compliance; and FOREWARN, an app-based solution that provides instant knowledge before face-to-face engagement with a consumer, as well as helps professionals to identify and mitigate risk. The company serves financial services, insurance, healthcare, retail, telecommunication companies, law enforcement and government agencies, collections, law, corporate security, and investigative firms. It markets its products and services through value-added distributors, resellers, and strategic partners; and trade shows and seminars, advertising, public relations, distribution of sales literature, and product specifications and ongoing communication with prospective customers, distributors, resellers, strategic partners, and installed base of current customers, as well as through direct sales. The company was incorporated in 2017 and is headquartered in Boca Raton, Florida.

About Datasea

Datasea Inc., through its subsidiaries, provides technology and information systems in the People's Republic of China. The company provides smart city solutions and 5G messaging applications. It also offers its smart security solutions primarily to schools, tourist or scenic attractions, and public communities. In addition, the company provides intelligent acoustics products, which include ultrasonic air sterilizer, air purification and deodorization, and other products. The company was formerly known as Rose Rock, Inc. and changed its name to Datasea Inc. in October 2015. Datasea Inc. was incorporated in 2014 and is headquartered in Beijing, the People's Republic of China.