IAC/InterActiveCorp (IAC) versus The Competition Critical Review

IAC/InterActiveCorp (NASDAQ: IAC) is one of 51 publicly-traded companies in the “Internet Services” industry, but how does it compare to its peers? We will compare IAC/InterActiveCorp to related businesses based on the strength of its dividends, valuation, earnings, analyst recommendations, profitability, institutional ownership and risk.

Institutional & Insider Ownership

91.4% of IAC/InterActiveCorp shares are held by institutional investors. Comparatively, 73.1% of shares of all “Internet Services” companies are held by institutional investors. 11.3% of IAC/InterActiveCorp shares are held by insiders. Comparatively, 20.1% of shares of all “Internet Services” companies 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.

Profitability

This table compares IAC/InterActiveCorp and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IAC/InterActiveCorp 11.81% 4.26% 1.98%
IAC/InterActiveCorp Competitors 0.17% 36.07% 6.46%

Risk & Volatility

IAC/InterActiveCorp has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, IAC/InterActiveCorp’s peers have a beta of 1.06, meaning that their average stock price is 6% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for IAC/InterActiveCorp and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IAC/InterActiveCorp 0 1 17 0 2.94
IAC/InterActiveCorp Competitors 408 1605 2709 89 2.52

IAC/InterActiveCorp currently has a consensus price target of $140.72, suggesting a potential upside of 13.79%. As a group, “Internet Services” companies have a potential upside of 6.08%. Given IAC/InterActiveCorp’s stronger consensus rating and higher possible upside, analysts clearly believe IAC/InterActiveCorp is more favorable than its peers.

Earnings and Valuation

This table compares IAC/InterActiveCorp and its peers gross revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
IAC/InterActiveCorp $3.14 billion -$41.28 million 27.73
IAC/InterActiveCorp Competitors $1.03 billion $121.10 million 531.14

IAC/InterActiveCorp has higher revenue, but lower earnings than its peers. IAC/InterActiveCorp 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.

Summary

IAC/InterActiveCorp beats its peers on 7 of the 13 factors compared.

About IAC/InterActiveCorp

IAC/InterActiveCorp (IAC) is a media and Internet company. The Company’s brands include HomeAdvisor, Vimeo, Dictionary.com and Match Group’s online dating portfolio, which includes Tinder, PlentyOfFish and OkCupid. Its segments include Match Group, HomeAdvisor, Video, Applications and Publishing. Match Group includes the dating and non-dating businesses of Match Group, Inc. HomeAdvisor is a home services digital marketplace that helps connect consumers with home professionals in North America, as well as in France, the Netherlands and Italy under various brands. Its Video consists of Vimeo, Electus, CollegeHumor, Notional, IAC Films and Daily Burn. Applications consists of Consumer, which include its direct-to-consumer downloadable desktop applications, Apalon, which houses its mobile applications and SlimWare, and Partnerships, which includes its business-to-business partnership operations. Publishing consists of Premium Brands business, and Ask & Other business.

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