Critical Review: CompoSecure (NASDAQ:CMPO) & Iris Energy (NASDAQ:IREN)

CompoSecure (NASDAQ:CMPO) and Iris Energy (NASDAQ:IREN) are both business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Volatility and Risk

CompoSecure has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500. Comparatively, Iris Energy has a beta of 3.6, suggesting that its share price is 260% more volatile than the S&P 500.

Insider & Institutional Ownership

37.6% of CompoSecure shares are owned by institutional investors. Comparatively, 41.1% of Iris Energy shares are owned by institutional investors. 75.0% of CompoSecure shares are owned by insiders. Comparatively, 21.6% of Iris Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for CompoSecure and Iris Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CompoSecure	0	1	7	0	2.88
Iris Energy	0	2	9	1	2.92

CompoSecure currently has a consensus price target of $16.81, indicating a potential upside of 7.50%. Iris Energy has a consensus price target of $20.70, indicating a potential upside of 59.11%. Given Iris Energy’s stronger consensus rating and higher probable upside, analysts clearly believe Iris Energy is more favorable than CompoSecure.

Profitability

This table compares CompoSecure and Iris Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CompoSecure	-5.63%	-14.87%	36.45%
Iris Energy	-36.10%	-8.01%	-7.37%

Valuation & Earnings

This table compares CompoSecure and Iris Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CompoSecure	$390.63 million	3.53	$19.24 million	($0.44)	-35.55
Iris Energy	$188.76 million	12.95	-$28.95 million	N/A	N/A

CompoSecure has higher revenue and earnings than Iris Energy.

Summary

Iris Energy beats CompoSecure on 8 of the 13 factors compared between the two stocks.

About CompoSecure

CompoSecure, Inc. manufactures and designs metal, composite, and proprietary financial transaction cards in the United States and internationally. Its primary metal form factors include embedded, metal veneer lite, metal veneer, and full metal products. The company also offers Arculus Cold Storage Wallet, a three-factor authentication solution, which supports specific digital assets, including Bitcoin, Ethereum, non-fungible tokens and others. In addition, it offers Payments + Arculus Secure Authenticate, white-labeled cold storage wallet, Payments + Arculus Cold Storage, and Payments + Arculus Authentication + Arculus Cold Storage. The company serves financial institutions, plastic card manufacturers, system integrators, and security specialists. CompoSecure, Inc. was founded in 1910 and is based in Somerset, New Jersey.

About Iris Energy

Iris Energy Limited owns and operates bitcoin mining data centers. The company was incorporated in 2018 and is headquartered in Sydney, Australia.