Magic Software Enterprises (NASDAQ:MGIC) versus Link Motion (NASDAQ:LKM) Critical Contrast

Magic Software Enterprises (NASDAQ:MGIC) and Link Motion (NYSE:LKM) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, profitability and institutional ownership.

Earnings and Valuation

This table compares Magic Software Enterprises and Link Motion’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Magic Software Enterprises $284.38 million 1.48 $19.88 million $0.55 15.62
Link Motion $57.61 million 0.26 -$27.12 million N/A N/A

Magic Software Enterprises has higher revenue and earnings than Link Motion.

Analyst Recommendations

This is a breakdown of current recommendations for Magic Software Enterprises and Link Motion, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Magic Software Enterprises 1 0 1 0 2.00
Link Motion 0 0 0 0 N/A

Magic Software Enterprises presently has a consensus price target of $10.00, indicating a potential upside of 16.41%. Given Magic Software Enterprises’ higher probable upside, analysts plainly believe Magic Software Enterprises is more favorable than Link Motion.

Profitability

This table compares Magic Software Enterprises and Link Motion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Magic Software Enterprises 7.21% 10.83% 7.12%
Link Motion N/A N/A N/A

Dividends

Magic Software Enterprises pays an annual dividend of $0.30 per share and has a dividend yield of 3.5%. Link Motion does not pay a dividend. Magic Software Enterprises pays out 54.5% of its earnings in the form of a dividend.

Institutional & Insider Ownership

15.5% of Magic Software Enterprises shares are owned by institutional investors. Comparatively, 0.2% of Link Motion shares are owned by institutional investors. 4.5% of Magic Software Enterprises shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Magic Software Enterprises beats Link Motion on 11 of the 12 factors compared between the two stocks.

About Magic Software Enterprises

Magic Software Enterprises Ltd. provides proprietary application development, business process integration, vertical software solutions, and IT outsourcing software services in Israel and internationally. The company's Software Services segment develops, markets, sells, and supports a proprietary and none proprietary application platform, software applications, and business and process integration solutions and related services. Its IT Professional Services segment offers IT services in the areas of infrastructure design and delivery, application development, technology planning and implementation services, and communications services and solutions, as well as supplemental outsourcing services. The company offers Magic xpa, a proprietary application platform for developing and deploying business applications; AppBuilder, a proprietary application platform for building, deploying, and maintaining high-end and mainframe-grade business applications; Magic xpi integration platform, a graphical wizard-based code-free solution; and Magic xpc, a hybrid integration platform as a service. It also provides vertical software solutions comprising Clicks, a software solution for healthcare providers; Leap, a software solution for business support systems; Hermes Solution, a packaged software solution for managing air cargo ground handling; HR Pulse, a customized single-tenant software as a service tool; and MBS Solution, a proprietary system for managing TV broadcast channels. In addition, the company provides software maintenance, support, training, and consulting services. It serves oil and gas, telecommunications, financial, healthcare, and industrial sectors, as well as public institutions and international agencies. The company was formerly known as Mashov Software Export (1983) Ltd. and changed its name to Magic Software Enterprises Ltd. in 1991. Magic Software Enterprises Ltd. was founded in 1983 and is headquartered in Or Yehuda, Israel.

About Link Motion

Link Motion Inc. operates as a smart car and smart ride company in the People's Republic of China and internationally. Its offerings include enabling technology solutions and secure connected carputers for the ecosystem of car businesses; and consumer ride sharing services, as well as mobile security, productivity, and other related applications. The company was formerly known as NQ Mobile Inc. and changed its name to Link Motion Inc. in March 2018. Link Motion Inc. was founded in 2005 and is based in Beijing, the People's Republic of China.

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