Head-To-Head Survey: MediaAlpha (NYSE:MAX) vs. HealthEquity (NASDAQ:HQY)

MediaAlpha (NYSE:MAX) and HealthEquity (NASDAQ:HQY) are both business services companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, dividends, valuation and profitability.

Profitability

This table compares MediaAlpha and HealthEquity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MediaAlpha	-10.41%	N/A	-27.85%
HealthEquity	5.57%	6.91%	4.41%

Risk and Volatility

MediaAlpha has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, HealthEquity has a beta of 0.53, suggesting that its share price is 47% less volatile than the S&P 500.

Valuation and Earnings

This table compares MediaAlpha and HealthEquity’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MediaAlpha	$388.15 million	3.13	-$40.42 million	($0.89)	-20.74
HealthEquity	$999.59 million	6.74	$55.71 million	$0.64	122.73

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

Analyst Ratings

This is a breakdown of current ratings and price targets for MediaAlpha and HealthEquity, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MediaAlpha	1	0	5	0	2.67
HealthEquity	0	0	11	0	3.00

MediaAlpha presently has a consensus target price of $18.20, indicating a potential downside of 1.41%. HealthEquity has a consensus target price of $96.17, indicating a potential upside of 22.43%. Given HealthEquity’s stronger consensus rating and higher possible upside, analysts plainly believe HealthEquity is more favorable than MediaAlpha.

Institutional & Insider Ownership

64.4% of MediaAlpha shares are held by institutional investors. Comparatively, 99.6% of HealthEquity shares are held by institutional investors. 9.6% of MediaAlpha shares are held by company insiders. Comparatively, 2.7% of HealthEquity shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

HealthEquity beats MediaAlpha on 12 of the 14 factors compared between the two stocks.

About MediaAlpha

MediaAlpha, Inc., through its subsidiaries, operates an insurance customer acquisition platform in the United States. It optimizes customer acquisition in various verticals of property and casualty insurance, health insurance, and life insurance. The company was founded in 2014 and is headquartered in Los Angeles, California.

About HealthEquity

HealthEquity, Inc. provides technology-enabled services platforms to consumers and employers in the United States. The company offers cloud-based platforms for individuals to make health saving and spending decisions, pay healthcare bills, receive personalized benefit information, earn wellness incentives, grow their savings, and make investment choices; and health savings accounts. It also provides investment platform; and online-only automated investment advisory services through Advisor, a Web-based tool. In addition, the company offers flexible spending accounts; health reimbursement arrangements; and Consolidated Omnibus Budget Reconciliation Act continuation services, as well as administers pre-tax commuter benefit programs. It serves clients through a direct sales force; benefits brokers and advisors; and a network of health plans, benefits administrators, benefits brokers and consultants, and retirement plan record-keepers. HealthEquity, Inc. was incorporated in 2002 and is based in Draper, Utah.