Analyzing SecureWorks (NASDAQ:SCWX) and Konami (OTCMKTS:KNMCY)

SecureWorks (NASDAQ:SCWX) and Konami (OTCMKTS:KNMCY) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.

Insider and Institutional Ownership

14.4% of SecureWorks shares are owned by institutional investors. Comparatively, 0.0% of Konami shares are owned by institutional investors. 81.5% of SecureWorks shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for SecureWorks and Konami, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SecureWorks	1	1	0	0	1.50
Konami	0	0	0	0	N/A

SecureWorks currently has a consensus target price of $7.00, suggesting a potential downside of 9.68%. Given SecureWorks’ higher possible upside, equities research analysts plainly believe SecureWorks is more favorable than Konami.

Profitability

This table compares SecureWorks and Konami’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SecureWorks	-21.23%	-4.94%	-3.43%
Konami	7.25%	6.91%	4.60%

Earnings and Valuation

This table compares SecureWorks and Konami”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SecureWorks	$346.35 million	1.98	-$86.04 million	($1.06)	-7.31
Konami	$2.42 billion	3.56	$183.01 million	$1.33	47.83

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

Risk and Volatility

SecureWorks has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, Konami has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500.

Summary

Konami beats SecureWorks on 8 of the 12 factors compared between the two stocks.

About SecureWorks

SecureWorks Corp., through its subsidiaries, provides technology-driven information security solutions for protecting its customers in the United States and internationally. The company's solutions include software-as-a-service solutions; managed security services; and professional services, including incident response and penetration testing services. Its solutions enable organizations to prevent security breaches, detect malicious activity, respond rapidly to security breaches, and identify emerging threats. The company sells its solutions primarily through its referral agents, regional value-added resellers, trade associations, and managed security service providers. It serves customers in a range of industries, including financial services, manufacturing, technology, retail, insurance, utility, and healthcare sectors. The company was formerly known as SecureWorks Holding Corporation and changed its name to SecureWorks Corp. in November 2015. SecureWorks Corp. was founded in 1999 and is headquartered in Atlanta, Georgia. SecureWorks Corp. is a subsidiary of Dell Marketing L.P.

About Konami

Konami Holdings Corporation, together with its subsidiaries, primarily engages in the digital entertainment business. It operates through four segments: Digital Entertainment, Health & Fitness, Gaming & Systems, and Pachislot & Pachinko Machines. The Digital Entertainment segment manufactures and sells digital content and related products, including mobile games, arcade games, card games, and computer and video games. The Health & Fitness segment operates health and fitness clubs, as well as designs, manufactures, and sells fitness machines and health products. The Gaming & Systems segment designs, manufactures, sells, and services gaming machines and casino management systems. The Pachislot & Pachinko Machines segment researches, designs, produces, and sells pachinko slot and pachinko machines. It operates in Japan and other Asia/Oceania countries, the United States, and Europe. The company was formerly known as Konami Corporation and changed its name to Konami Holdings Corporation in October 2015. Konami Holdings Corporation was founded in 1969 and is headquartered in Tokyo, Japan.