Critical Analysis: Grom Social Enterprises (NASDAQ:GROM) versus Rumble (NASDAQ:RUM)

Rumble (NASDAQ:RUM) and Grom Social Enterprises (NASDAQ:GROM) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, earnings and analyst recommendations.

Earnings & Valuation

This table compares Rumble and Grom Social Enterprises”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rumble	$95.49 million	32.47	-$116.42 million	($1.64)	-4.35
Grom Social Enterprises	$3.72 million	0.00	-$12.53 million	($11.67)	0.00

Grom Social Enterprises has lower revenue, but higher earnings than Rumble. Rumble is trading at a lower price-to-earnings ratio than Grom Social Enterprises, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Rumble and Grom Social Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rumble	-152.81%	-62.75%	-50.56%
Grom Social Enterprises	N/A	N/A	N/A

Risk & Volatility

Rumble has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Grom Social Enterprises has a beta of 1.65, suggesting that its share price is 65% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Rumble and Grom Social Enterprises, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rumble	0	1	1	0	2.50
Grom Social Enterprises	0	0	0	0	0.00

Rumble presently has a consensus price target of $14.00, indicating a potential upside of 96.08%. Given Rumble’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Rumble is more favorable than Grom Social Enterprises.

Institutional & Insider Ownership

26.1% of Rumble shares are held by institutional investors. Comparatively, 15.9% of Grom Social Enterprises shares are held by institutional investors. 70.1% of Rumble shares are held by insiders. Comparatively, 0.0% of Grom Social Enterprises shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Rumble beats Grom Social Enterprises on 8 of the 14 factors compared between the two stocks.

About Rumble

Rumble Inc. operates video sharing platforms in the United States, Canada, and internationally. The company operates rumble.com, a free-to-use video sharing and livestreaming platform where users can subscribe to channels to stay in touch with creators, and access video on-demand (VOD) and live content streamed by creators. It also operates locals.com, a platform where users can access free content and purchase subscriptions to support creators and access exclusive content in creator communities; Rumble Streaming Marketplace, a patent-pending application designed to enable a first-of-its-kind livestreaming and monetization service for creators; and Rumble Advertising Center (RAC), an online advertising management exchange. The company was founded in 2013 and is headquartered in Longboat Key, Florida.

About Grom Social Enterprises

Grom Social Enterprises, Inc., through its subsidiaries, operates as a media, technology, and entertainment company in the United States and Philippines. It operates through three segments: Animation, Original Content, and Social and Technology. The company operates a social media network for children under the age of 13 years. It also produces animated films and televisions series; and provides web filtering services to schools and government agencies, as well as acquires, develops, and builds commercial potential of kids and family entertainment properties and associated business opportunities. Grom Social Enterprises, Inc. was founded in 2012 and is headquartered in Boca Raton, Florida.