Netflix (NASDAQ:NFLX – Get Free Report) and Capcom (OTCMKTS:CCOEY – Get Free Report) are both large-cap communication services companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, valuation, analyst recommendations, dividends and profitability.
Risk & Volatility
Netflix has a beta of 1.62, suggesting that its stock price is 62% more volatile than the S&P 500. Comparatively, Capcom has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500.
Earnings and Valuation
This table compares Netflix and Capcom”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Netflix | $45.18 billion | 6.42 | $10.98 billion | $3.18 | 21.92 |
| Capcom | $1.30 billion | 11.27 | $360.28 million | $0.51 | 26.90 |
Netflix has higher revenue and earnings than Capcom. Netflix is trading at a lower price-to-earnings ratio than Capcom, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Netflix and Capcom’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Netflix | 28.22% | 40.02% | 19.81% |
| Capcom | 30.13% | 24.90% | 20.58% |
Institutional & Insider Ownership
80.9% of Netflix shares are owned by institutional investors. 1.2% of Netflix shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of current ratings for Netflix and Capcom, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Netflix | 1 | 15 | 35 | 4 | 2.76 |
| Capcom | 0 | 2 | 0 | 0 | 2.00 |
Netflix currently has a consensus target price of $94.94, suggesting a potential upside of 36.21%. Given Netflix’s stronger consensus rating and higher probable upside, research analysts clearly believe Netflix is more favorable than Capcom.
Summary
Netflix beats Capcom on 11 of the 15 factors compared between the two stocks.
About Netflix
Netflix, Inc. provides entertainment services. It offers TV series, documentaries, feature films, and games across various genres and languages. The company also provides members the ability to receive streaming content through a host of internet-connected devices, including TVs, digital video players, TV set-top boxes, and mobile devices. It has operations in approximately 190 countries. The company was incorporated in 1997 and is headquartered in Los Gatos, California.
About Capcom
Capcom Co., Ltd. plans, develops, manufactures, sells, and distributes home video games, online games, mobile games, and arcade games in Japan and internationally. It operates through Digital Contents, Arcade Operations, Amusement Equipments, and Other Businesses segments. The Digital Contents segment develops and sells digital game content for consumer home video game platforms, as well as mobile content and PC online games. The Arcade Operations segment operates Plaza Capcom amusement facilities primarily in commercial complexes, as well as hosts various events. The Amusement Equipments segment is involved in the development, manufacture, and sale of software, frames and LCD devices for gaming machines. The Other Businesses segment engages in the adapting game content into movies, animated television programs, music CDs, and merchandise; and devoting resources to esports. Capcom Co., Ltd. was incorporated in 1979 and is headquartered in Osaka, Japan.
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