Financial Analysis: Pareteum (TEUM) versus Godaddy (GDDY)

Godaddy (NYSE:GDDY) and Pareteum (NASDAQ:TEUM) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Risk and Volatility

Godaddy has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500. Comparatively, Pareteum has a beta of 0.07, meaning that its stock price is 93% less volatile than the S&P 500.

Earnings & Valuation

This table compares Godaddy and Pareteum’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Godaddy	$2.23 billion	5.12	$136.40 million	$0.42	156.83
Pareteum	$13.55 million	17.91	-$12.46 million	($0.84)	-2.95

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

Profitability

This table compares Godaddy and Pareteum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Godaddy	4.96%	8.01%	0.86%
Pareteum	-67.83%	-60.67%	-43.28%

Institutional & Insider Ownership

94.8% of Godaddy shares are owned by institutional investors. Comparatively, 6.8% of Pareteum shares are owned by institutional investors. 7.6% of Godaddy shares are owned by company insiders. Comparatively, 3.4% of Pareteum shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Godaddy and Pareteum, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Godaddy	1	4	12	0	2.65
Pareteum	0	1	3	0	2.75

Godaddy presently has a consensus price target of $77.00, suggesting a potential upside of 16.90%. Pareteum has a consensus price target of $7.00, suggesting a potential upside of 182.26%. Given Pareteum’s stronger consensus rating and higher possible upside, analysts clearly believe Pareteum is more favorable than Godaddy.

Summary

Godaddy beats Pareteum on 11 of the 14 factors compared between the two stocks.

About Godaddy

GoDaddy Inc. designs and develops cloud-based technology products for small businesses, Web design professionals, and individuals in the United States and internationally. It provides domain name registration product that enables to engage customers at the initial stage of establishing a digital identity; hosting products, such as shared Website hosting, Website hosting on virtual private servers and virtual dedicated servers, managed hosting, and security. The company also offers presence products, including GoCentral, an online tool that enables customers to build Websites and online stores; and a range of marketing tools designed to help businesses acquire and engage customers, as well as search engine optimization that helps customers get their Websites found on search sites. In addition, the company offers business application products, including Microsoft Office 365, email accounts, email marketing, and telephony services. GoDaddy Inc. was incorporated in 2014 and is headquartered in Scottsdale, Arizona.

About Pareteum

Pareteum Corporation operates a communications cloud services platform in Europe and internationally. Its platform provides mobility, messaging, and security services and applications, with a single-sign-on, application program interface (API), and software development suite. The company’s platform hosts integrated IT/back office and core network functionality for mobile network operators, as well as for enterprises to implement and leverage mobile communications solutions on a SaaS, PaaS, or IaaS basis. It also offers operational support system for channel partners with APIs for integration with third party systems, workflows for complex application orchestration, and customer support with branded portals and plug-ins for various other applications. Pareteum Corporation serves the markets of Internet of Things, mobile virtual network operators, smart cities, and application developers. The company was formerly known as Elephant Talk Communications Corp. and changed its name to Pareteum Corporation in November 2016. Pareteum Corporation is based in New York, New York.

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