Financial Analysis: PLAYSTUDIOS (NASDAQ:MYPS) and SPS Commerce (NASDAQ:SPSC)

SPS Commerce (NASDAQ:SPSC) and PLAYSTUDIOS (NASDAQ:MYPS) are both business services companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, analyst recommendations, risk, dividends and valuation.

Insider and Institutional Ownership

99.0% of SPS Commerce shares are owned by institutional investors. Comparatively, 37.5% of PLAYSTUDIOS shares are owned by institutional investors. 1.0% of SPS Commerce shares are owned by company insiders. Comparatively, 14.3% of PLAYSTUDIOS shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

SPS Commerce has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500. Comparatively, PLAYSTUDIOS has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Profitability

This table compares SPS Commerce and PLAYSTUDIOS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SPS Commerce	12.08%	12.27%	10.10%
PLAYSTUDIOS	-8.75%	-9.15%	-7.29%

Valuation and Earnings

This table compares SPS Commerce and PLAYSTUDIOS”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SPS Commerce	$637.77 million	8.32	$77.05 million	$2.04	69.23
PLAYSTUDIOS	$310.89 million	0.68	-$19.39 million	($0.19)	-8.95

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

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for SPS Commerce and PLAYSTUDIOS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SPS Commerce	0	5	6	0	2.55
PLAYSTUDIOS	1	3	2	0	2.17

SPS Commerce presently has a consensus price target of $207.11, suggesting a potential upside of 46.66%. PLAYSTUDIOS has a consensus price target of $3.63, suggesting a potential upside of 113.24%. Given PLAYSTUDIOS’s higher possible upside, analysts plainly believe PLAYSTUDIOS is more favorable than SPS Commerce.

Summary

SPS Commerce beats PLAYSTUDIOS on 12 of the 14 factors compared between the two stocks.

About SPS Commerce

SPS Commerce, Inc. provides cloud-based supply chain management solutions in the United States and internationally. It offers solutions through the SPS Commerce, a cloud-based platform that enhances the way retailers, grocers, suppliers, distributors, and logistics firms manage and fulfill omnichannel orders, optimize sell-through performance, and automate new trading relationships. The company also provides Fulfillment, an electronic data interchange solution that scales as a business grows, where companies use a single system to manage orders and logistics from various sales channels, including wholesale, eCommerce, and marketplaces; and Analytics product that enables organizations to enhance visibility into how products are selling through a single connection across various sales channels, including wholesale, eCommerce, and marketplaces, as well as enhances access and usage of sales and inventory data through a combination of analytics applications, network of connections, and industry-leading expertise. In addition, it offers various complimentary products, such as assortment product, which simplifies the communication of robust, accurate item data by automatically translating item attributes, and hierarchies; and community product that allows organizations to accelerate digitization of their supply chain and improve collaboration with suppliers through change management and onboarding programs. The company was formerly known as St. Paul Software, Inc. and changed its name to SPS Commerce, Inc. in May 2001. SPS Commerce, Inc. was incorporated in 1987 and is headquartered in Minneapolis, Minnesota.

About PLAYSTUDIOS

PLAYSTUDIOS, Inc. develops and publishes free-to-play casual games for mobile and social platforms in the United States and internationally. The company's game portfolio includes a diverse range of titles comprising social casino, card, puzzle, and adventure games. It also offers POP! Slots, myVEGAS Slots, my KONAMI Slots, MGM Slots Live, myVEGAS Blackjack, myVEGAS Bingo, Tetris, Solitaire, Spider Solitaire, Jumbline 2, Sudoku, and Mahjong games. PLAYSTUDIOS, Inc. is headquartered in Las Vegas, Nevada.