Critical Comparison: ReachLocal (RLOC) and Its Rivals

ReachLocal (NASDAQ: RLOC) is one of 31 public companies in the “Advertising & Marketing” industry, but how does it contrast to its competitors? We will compare ReachLocal to similar companies based on the strength of its risk, dividends, earnings, valuation, analyst recommendations, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and recommmendations for ReachLocal and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ReachLocal 0 0 0 0 N/A
ReachLocal Competitors 57 400 842 16 2.62

As a group, “Advertising & Marketing” companies have a potential upside of 21.97%. Given ReachLocal’s competitors higher possible upside, analysts plainly believe ReachLocal has less favorable growth aspects than its competitors.

Insider & Institutional Ownership

57.6% of shares of all “Advertising & Marketing” companies are owned by institutional investors. 22.0% of shares of all “Advertising & Marketing” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares ReachLocal and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ReachLocal -5.20% N/A -15.27%
ReachLocal Competitors -2.57% -6.68% -0.33%

Valuation & Earnings

This table compares ReachLocal and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
ReachLocal N/A N/A -2.79
ReachLocal Competitors $2.71 billion $171.61 million -1,140.26

ReachLocal’s competitors have higher revenue and earnings than ReachLocal. ReachLocal is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

ReachLocal competitors beat ReachLocal on 6 of the 8 factors compared.

ReachLocal Company Profile

ReachLocal, Inc. (ReachLocal) offers a range of online marketing and reporting solutions. The Company’s digital marketing solution consists of products and solutions in three categories: digital advertising (including ReachSearch, ReachDisplay, ReachDisplay InApp and ReachRetargeting); Web presence (including ReachSite+ReachEdge, ReachSEO, ReachCast, ReachListings and TotalLiveChat), and software (ReachEdge and Kickserv). It focuses on small to medium-sized businesses (SMBs). The Company delivers its suite of products and solutions to local businesses through a combination of its technology platform, its direct inside and outside sales force, and select third-party agencies and resellers. It also focuses on certain core verticals, which include home services, professional services, specialty services and healthcare. It also provides solutions to multi-location advertisers, such as franchises and other businesses that have multiple locations across a number of cities and states.

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