Harte Hanks (NASDAQ:HHS – Get Free Report) and Gray Media (NYSE:GTN – Get Free Report) are both small-cap communication services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.
Dividends
Harte Hanks pays an annual dividend of $0.34 per share and has a dividend yield of 7.4%. Gray Media pays an annual dividend of $0.32 per share and has a dividend yield of 7.0%. Harte Hanks pays out -44.7% of its earnings in the form of a dividend. Gray Media pays out -52.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Insider and Institutional Ownership
33.8% of Harte Hanks shares are held by institutional investors. Comparatively, 78.6% of Gray Media shares are held by institutional investors. 9.6% of Harte Hanks shares are held by insiders. Comparatively, 8.9% of Gray Media shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Harte Hanks | $154.63 million | 0.22 | -$810,000.00 | ($0.76) | -6.06 |
| Gray Media | $3.10 billion | 0.15 | -$85.00 million | ($0.61) | -7.54 |
Harte Hanks has higher earnings, but lower revenue than Gray Media. Gray Media is trading at a lower price-to-earnings ratio than Harte Hanks, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent recommendations for Harte Hanks and Gray Media, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Harte Hanks | 1 | 0 | 0 | 0 | 1.00 |
| Gray Media | 1 | 2 | 3 | 0 | 2.33 |
Gray Media has a consensus target price of $7.88, indicating a potential upside of 71.27%. Given Gray Media’s stronger consensus rating and higher possible upside, analysts plainly believe Gray Media is more favorable than Harte Hanks.
Profitability
This table compares Harte Hanks and Gray Media’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Harte Hanks | -3.70% | -30.14% | -6.30% |
| Gray Media | -0.83% | -1.12% | -0.23% |
Volatility & Risk
Harte Hanks has a beta of 0.09, indicating that its stock price is 91% less volatile than the S&P 500. Comparatively, Gray Media has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.
Summary
Gray Media beats Harte Hanks on 11 of the 16 factors compared between the two stocks.
About Harte Hanks
Harte-Hanks, Inc. engages in the provision of marketing solutions. It specializes in consulting, data analytics, creative services, digital and social media, marketing strategy, marketing technology, and other related services. It supports a range of customers in the field of technology, travel and leisure, entertainment, pharmaceuticals, automotive, finance, and retail. The company was founded in 1923 and is headquartered in San Antonio, TX.
About Gray Media
Gray Television, Inc., a television broadcasting company, owns and/or operates television stations and digital assets in the United States. It also broadcasts secondary digital channels affiliated to ABC, CBS, NBC, and FOX, as well as various other networks and program services, including CW Plus Network, MY Network, the MeTV Network, Circle, Telemundo, THE365, and Outlaw; and local news/weather channels in various markets. It owns and operates television stations and digital assets that serve television markets in the United States. The company was formerly known as Gray Communications Systems, Inc. and changed its name to Gray Television, Inc. in August 2002. Gray Television, Inc. was founded in 1891 and is headquartered in Atlanta, Georgia.
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