Reviewing NetEase (NASDAQ:NTES) and Aware (NASDAQ:AWRE)

Aware (NASDAQ:AWRE) and NetEase (NASDAQ:NTES) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, institutional ownership, profitability, analyst recommendations, earnings and risk.

Insider and Institutional Ownership

24.4% of Aware shares are owned by institutional investors. Comparatively, 11.1% of NetEase shares are owned by institutional investors. 28.0% of Aware shares are owned by insiders. Comparatively, 54.7% of NetEase shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Aware and NetEase’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aware	-30.44%	-16.17%	-11.91%
NetEase	30.12%	23.08%	16.90%

Analyst Recommendations

This is a summary of current recommendations and price targets for Aware and NetEase, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aware	0	0	0	0	0.00
NetEase	0	1	7	0	2.88

NetEase has a consensus price target of $119.38, indicating a potential downside of 8.41%. Given NetEase’s stronger consensus rating and higher probable upside, analysts plainly believe NetEase is more favorable than Aware.

Volatility & Risk

Aware has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, NetEase has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500.

Earnings & Valuation

This table compares Aware and NetEase”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aware	$17.39 million	2.26	-$4.43 million	($0.25)	-7.44
NetEase	$14.43 billion	5.72	$4.07 billion	$6.95	18.75

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

Summary

NetEase beats Aware on 12 of the 14 factors compared between the two stocks.

About Aware

Aware, Inc., an authentication company, provides biometrics software products and solutions for government agencies and commercial entities in the United States, the United Kingdom, and internationally. The company offers biometric software solution, including Knomi, a mobile biometric framework which provides multiple biometric modality options; AwareABIS, an automated biometric identification system used for large-scale biometric identification and deduplication; AFIX suite used for small-scale law enforcement focused biometric identification; and AFIX Tracker for fingerprint, palmprint, and latent print identification, as well as AFIX Face, AFIX Verifier, AFIX Identifier, AFIX Comparator, AFIX Engine, and AFIX NIST Transaction Engine. It also provides BioSP, a biometric integration platform-as-a-service that enables biometric data processing and management functionality in a web services architecture; WebEnroll, a browser-based biometric enrollment and data management solution; and AwareID, a software-as-a-service that provides identity verification and continuous authentication capabilities. In addition, the company offers biometrics applications, such as Nexa line, a biometric search and match SDKs including Nexa Fingerprint, Nexa Face, Nexa Iris, and Nexa Voice; and AwareXM, an interoperable fingerprint matching SDK that provides fingerprint minutiae extraction, template generation, and fingerprint authentication. Further, it sells imaging products used in medical and advanced imaging application; and offers software maintenance, program management, and software engineering services. The company sells its products, services, and solutions through systems integrators, direct, and original equipment manufacturers and value added resellers channel. Aware, Inc. was incorporated in 1986 and is headquartered in Burlington, Massachusetts.

About NetEase

NetEase, Inc. engages in online games, music streaming, online intelligent learning services, and internet content services businesses in China and internationally . The company operates through Games and Related Value-Added Services, Youdao, Cloud Music, and Innovative Businesses and Others segments. It develops and operates PC and mobile games, as well as offers games licensed from other game developers. The company's products and services include Youdao Dictionary, an online knowledge tool; Youdao Translation, a tool specifically designed to support translation needs of business and leisure travelers; U-Dictionary, an online dictionary and translation app; Youdao Kids' Dictionary, a smart and fun tool; smart devices, such as Youdao Dictionary Pen, Youdao Smart Learning Pad, Youdao Listening Pod, Youdao Smart Light, Youdao Pocket Translator, and Youdao Super Dictionary; online courses; interactive learning apps; and education digitalization solutions, such as Youdao Smart Learning Terminal, a device that automates paper-based homework processing; Youdao Smart Cloud, a cloud-based platform that allows third-party app developers, smart device brands, and manufacturers to the company's OCR capabilities; and Youdao Sports, a sports-centric educational system. Its products and services also include NetEase Cloud Music, a music streaming platform; Yanxuan, an e-commerce platform, which sells private label products; www.163.com portal and related mobile app, Wangyi Xinwen, which deliver information such as news, sports events, technology, fashion trends, and online entertainment; NetEase Mail, an email service; NetEase CC Live streaming, a live streaming platform with a focus on game broadcasting; and NetEase Pay, a payment platform. The company was formerly known as NetEase.com, Inc. and changed its name to NetEase, Inc. in March 2012. NetEase, Inc. was founded in 1997 and is headquartered in Hangzhou, the People's Republic of China.