Contrasting Grom Social Enterprises (NASDAQ:GROM) and Meta Platforms (NASDAQ:META)

Grom Social Enterprises (NASDAQ:GROM) and Meta Platforms (NASDAQ:META) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, dividends, valuation and analyst recommendations.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Grom Social Enterprises	-386.01%	-89.97%	-70.42%
Meta Platforms	32.06%	32.03%	21.21%

Institutional and Insider Ownership

15.9% of Grom Social Enterprises shares are owned by institutional investors. Comparatively, 79.9% of Meta Platforms shares are owned by institutional investors. 0.0% of Grom Social Enterprises shares are owned by company insiders. Comparatively, 13.7% of Meta Platforms shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for Grom Social Enterprises and Meta Platforms, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grom Social Enterprises	0	0	0	0	N/A
Meta Platforms	2	3	37	2	2.89

Meta Platforms has a consensus price target of $511.27, indicating a potential upside of 0.26%. Given Meta Platforms’ higher probable upside, analysts plainly believe Meta Platforms is more favorable than Grom Social Enterprises.

Valuation & Earnings

This table compares Grom Social Enterprises and Meta Platforms’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grom Social Enterprises	$4.04 million	0.86	-$12.53 million	($11.67)	-0.03
Meta Platforms	$142.71 billion	9.06	$39.10 billion	$17.41	29.29

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

Volatility and Risk

Grom Social Enterprises has a beta of 1.5, meaning that its stock price is 50% more volatile than the S&P 500. Comparatively, Meta Platforms has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500.

Summary

Meta Platforms beats Grom Social Enterprises on 12 of the 13 factors compared between the two stocks.

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.

About Meta Platforms

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. It operates in two segments, Family of Apps and Reality Labs. The Family of Apps segment offers Facebook, which enables people to share, discuss, discover, and connect with interests; Instagram, a community for sharing photos, videos, and private messages, as well as feed, stories, reels, video, live, and shops; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact privately. The Reality Labs segment provides augmented and virtual reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. The company was incorporated in 2004 and is headquartered in Menlo Park, California