Critical Analysis: Marchex (MCHX) and Its Competitors

Marchex (NASDAQ: MCHX) is one of 36 public companies in the “Advertising & Marketing” industry, but how does it contrast to its peers? We will compare Marchex to similar companies based on the strength of its earnings, analyst recommendations, risk, institutional ownership, dividends, profitability and valuation.

Valuation and Earnings

This table compares Marchex and its peers gross revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Marchex $105.54 million -$12.35 million -7.87
Marchex Competitors $1.13 billion $150.73 million 17.74

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

Insider & Institutional Ownership

49.7% of Marchex shares are owned by institutional investors. Comparatively, 57.7% of shares of all “Advertising & Marketing” companies are owned by institutional investors. 27.4% of Marchex shares are owned by insiders. Comparatively, 21.0% of shares of all “Advertising & Marketing” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Marchex has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, Marchex’s peers have a beta of 1.04, indicating that their average share price is 4% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Marchex and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Marchex 0 1 0 0 2.00
Marchex Competitors 81 539 927 17 2.56

Marchex presently has a consensus target price of $3.00, indicating a potential downside of 2.28%. As a group, “Advertising & Marketing” companies have a potential upside of 17.99%. Given Marchex’s peers stronger consensus rating and higher probable upside, analysts plainly believe Marchex has less favorable growth aspects than its peers.

Profitability

This table compares Marchex and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Marchex -15.53% -10.65% -9.44%
Marchex Competitors -4.78% -9.31% -2.86%

Summary

Marchex peers beat Marchex on 10 of the 12 factors compared.

Marchex Company Profile

Marchex, Inc. is a mobile advertising analytics company. The Company offers products and services for enterprises that depend on consumer phone calls to drive sales. Its media analytics products can provide actionable intelligence on media channels advertisers use to acquire customers over the phone. Its Marchex Omnichannel Analytics Cloud helps marketers connect customer conversions driven from paid media channels, including search, display and video, social and sites, to phone calls made to a business. Its product offerings include Marchex Call Analytics, Marchex Search Analytics, Marchex Display and Video Analytics, Marchex Social Analytics, Marchex Call Marketplace and Local Leads. Its Local Leads platform is a white-labeled, full service advertising solution for small business resellers, such as Yellow Pages providers and vertical marketing service providers, to sell call advertising, search marketing and other lead generation products.

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