Reviewing Nexxen International (NASDAQ:NEXN) and Locafy (NASDAQ:LCFY)

Locafy (NASDAQ:LCFY) and Nexxen International (NASDAQ:NEXN) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, valuation, risk, institutional ownership, dividends and analyst recommendations.

Insider and Institutional Ownership

0.0% of Locafy shares are held by institutional investors. Comparatively, 54.2% of Nexxen International shares are held by institutional investors. 28.7% of Locafy shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings for Locafy and Nexxen International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Locafy	0	0	0	0	N/A
Nexxen International	0	1	3	0	2.75

Nexxen International has a consensus target price of $7.88, suggesting a potential upside of 13.80%. Given Nexxen International’s higher probable upside, analysts clearly believe Nexxen International is more favorable than Locafy.

Valuation and Earnings

This table compares Locafy and Nexxen International’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Locafy	$4.21 million	1.42	-$2.62 million	($1.87)	-2.51
Nexxen International	$331.99 million	1.43	-$21.49 million	($0.13)	-53.23

Locafy has higher earnings, but lower revenue than Nexxen International. Nexxen International is trading at a lower price-to-earnings ratio than Locafy, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Locafy has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500. Comparatively, Nexxen International has a beta of 1.84, meaning that its stock price is 84% more volatile than the S&P 500.

Profitability

This table compares Locafy and Nexxen International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Locafy	-66.21%	-82.35%	-45.02%
Nexxen International	-3.12%	4.86%	2.96%

Summary

Nexxen International beats Locafy on 10 of the 13 factors compared between the two stocks.

About Locafy

Locafy Limited operates as a software-as-a-service company (SaaS) that specializes in search engine marketing in Australia, New Zealand, Europe, North America, and internationally. The company operates in three segments: Publishing, Direct Sales, and Reseller Sales. It focuses on commercializing its SaaS online publishing technology platform that comprises an integrated suite of solutions. The company also owns and operates several online directories and offers search engine optimization solutions, which include creation of proximity pages and proximity networks, local pages, and map pack booster. In addition, its platform publishes content to various devices that uses a web browser to display web content, as well as programmatically optimizes the published content for local search. The company offers its solutions directly to customers, as well as through digital agencies and search engine optimization freelancers. The company was formerly known as Moboom Limited and changed its name to Locafy Limited in January 2021. Locafy Limited was incorporated in 2009 and is based in Subiaco, Australia.

About Nexxen International

Nexxen International Ltd. provides end-to-end software platform that enables advertisers to reach publishers Israel. The company's demand side platform (DSP) offers full-service and self-managed marketplace access to advertisers and agencies to execute their digital marketing campaigns in real time across various ad formats. Its sell supply side platform (SSP) provides access to data and a comprehensive product suite to drive inventory management and revenue optimization. The company also offers data management platform solution, which integrates DSP and SSP solutions enabling advertisers and publishers to use data from various sources in order to optimize results of their advertising campaigns. It serves ad buyers, advertisers, brands, agencies, and digital publishers in the United States, the Asia-Pacific, Europe, the Middle East, and Africa. The company was formerly known as Tremor International Ltd and changed its name to Nexxen International Ltd. in January 2024. Nexxen International Ltd. was incorporated in 2007 and is headquartered in Tel Aviv-Yafo, Israel.