Head to Head Comparison: Snap (SNAP) and GrubHub (GRUB)

Snap (NYSE: SNAP) and GrubHub (NYSE:GRUB) are both mid-cap technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, risk, valuation and profitability.

Insider & Institutional Ownership

18.9% of Snap shares are owned by institutional investors. 2.4% of GrubHub shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations for Snap and GrubHub, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Snap 13 20 11 0 1.95
GrubHub 1 9 13 0 2.52

Snap currently has a consensus target price of $17.10, suggesting a potential upside of 15.23%. GrubHub has a consensus target price of $59.52, suggesting a potential downside of 18.62%. Given Snap’s higher possible upside, equities research analysts clearly believe Snap is more favorable than GrubHub.

Profitability

This table compares Snap and GrubHub’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Snap -463.16% -107.36% -97.49%
GrubHub 9.60% 7.45% 6.07%

Valuation and Earnings

This table compares Snap and GrubHub’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Snap $404.48 million 44.18 -$514.64 million ($3.18) -4.67
GrubHub $493.33 million 12.85 $49.55 million $0.68 107.56

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

Summary

GrubHub beats Snap on 10 of the 13 factors compared between the two stocks.

Snap Company Profile

Snap Inc., formerly Snapchat, Inc., is a camera company. The Company’s flagship product, Snapchat, is a camera application that helps people to communicate through short videos and images known as a Snap. The Company offers three ways for people to make Snaps: the Snapchat application, Publishers Tools that help its partners to create Publisher Stories, and Spectacles, its sunglasses that make Snaps. Snaps are viewed primarily through the Snapchat application, but can also be embedded on the Web or on television in certain circumstances. Snapchat opens directly into the Camera, helping in creating a Snap and sending it to friends. The Company’s advertising products include Snap Ads and Sponsored Creative Tools, such as Sponsored Lenses and Sponsored Geofilters. As of December 31, 2016, on an average, 158 million people used Snapchat every day to Snap with family, watch Stories from friends, see events from around the world, and explore curated content from publishers.

GrubHub Company Profile

Grubhub Inc. provides an online and mobile platform for restaurant pick-up and delivery orders. Its products include Grubhub and Seamless Mobile Applications and Mobile Website, Grubhub and Seamless Websites, Corporate Program, Delivery, Allmenus and MenuPages, Grubhub for Restaurants, and Restaurant Websites. As of December 31, 2016, the Company connected more than 50,000 local restaurants with diners in more than 1,100 cities across the United States. In certain markets, the Company also provides delivery services to restaurants on its platform that do not have their own delivery operations. The Company provides diners on the platform with a personalized platform that helps them search for local restaurants and then place an order from an Internet-connected device. It also provides diners with information about their orders and status. The Company also provides delivery services to restaurants on its platform that do not have their own delivery operations.

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