Wetouch Technology (NASDAQ:WETH) vs. Magic Software Enterprises (NASDAQ:MGIC) Financial Contrast

Wetouch Technology (NASDAQ:WETH) and Magic Software Enterprises (NASDAQ:MGIC) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Wetouch Technology and Magic Software Enterprises, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wetouch Technology	0	0	0	0	0.00
Magic Software Enterprises	0	1	1	0	2.50

Magic Software Enterprises has a consensus price target of $18.00, suggesting a potential downside of 10.00%. Given Magic Software Enterprises’ stronger consensus rating and higher probable upside, analysts clearly believe Magic Software Enterprises is more favorable than Wetouch Technology.

Profitability

This table compares Wetouch Technology and Magic Software Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wetouch Technology	N/A	N/A	N/A
Magic Software Enterprises	6.58%	15.89%	8.92%

Institutional & Insider Ownership

24.7% of Magic Software Enterprises shares are held by institutional investors. 25.3% of Wetouch Technology shares are held by company insiders. Comparatively, 4.5% of Magic Software Enterprises shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Wetouch Technology has a beta of -0.44, meaning that its stock price is 144% less volatile than the S&P 500. Comparatively, Magic Software Enterprises has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500.

Earnings & Valuation

This table compares Wetouch Technology and Magic Software Enterprises”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wetouch Technology	$39.71 million	0.26	$8.26 million	N/A	N/A
Magic Software Enterprises	$552.52 million	1.78	$36.88 million	$0.78	25.64

Magic Software Enterprises has higher revenue and earnings than Wetouch Technology.

Summary

Magic Software Enterprises beats Wetouch Technology on 11 of the 12 factors compared between the two stocks.

About Wetouch Technology

Wetouch Technology Inc. engages in the research, development, manufacture, sale, and servicing of medium to large sized projected capacitive touchscreens in the Peoples Republic of China, Taiwan, South Korea, and internationally. The company offers various touch panels, including glass-glass, which are primarily used in GPS/car entertainment panels in mid-size and luxury cars, industrial human-machine interface (HMI), financial and banking terminals, point of sale, and lottery machines; glass-film-film products that are used in GPS and entertainment panels, industrial HMI, financial and banking terminals, lottery, and gaming industry; plastic-glass for use in GPS/entertainment panels, motor vehicle GPS, smart home products, robots, and charging stations; and glass-films used in industrial HMI. Wetouch Technology Inc. was founded in 2011 and is based in Meishan, China.

About Magic Software Enterprises

Magic Software Enterprises Ltd. provides proprietary application development, vertical software solutions, business process integration, information technologies (IT) outsourcing software services, and cloud-based services in Israel and internationally. Its Software Services segment develops, markets, sells, and supports application platform, software applications, and business and process integration solutions and related services. The company’s IT Professional Services segment offers IT services in the areas of infrastructure design and delivery, application development, technology planning and implementation services, communications services and solutions, and supplemental outsourcing services. It also offers proprietary application platforms, such as Magic xpa for developing and deploying business applications; AppBuilder for building, deploying, and maintaining business applications; Magic xpi for application integration; Magic xpi cloud native; FactoryEye for virtualization of production data; Magic Data Management and Analytics Platform for data management; and Magic SmartUX for cross-platform mobile business applications. The company also provides vertical software solutions comprising Clicks, a software solution for healthcare providers; Leap, a software solution for business support systems; Hermes Cargo, a packaged software solution for managing air cargo ground handling; HR Pulse, a single-tenant software as a service tool; MBS Solution, a system for managing TV broadcast management; Nativ, a system for management of rehabilitation centers; and Mobisale, a system for sales and distribution field activities for consumer goods manufacturers and wholesalers. In addition, It provides software maintenance, support, training, and consulting services. The company was formerly known as Mashov Software Export (1983) Ltd. and changed its name to Magic Software Enterprises Ltd. in 1991. The company was incorporated in 1983 and is headquartered in Or Yehuda, Israel.