Hello Group (NASDAQ:MOMO) versus Reddit (NYSE:RDDT) Head to Head Comparison
by Danessa Lincoln · The Markets DailyHello Group (NASDAQ:MOMO – Get Free Report) and Reddit (NYSE:RDDT – Get Free Report) are both communication services companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.
Analyst Ratings
This is a breakdown of recent ratings for Hello Group and Reddit, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hello Group | 1 | 1 | 1 | 0 | 2.00 |
| 0 | 11 | 18 | 2 | 2.71 |
Hello Group presently has a consensus price target of $9.05, suggesting a potential upside of 68.53%. Reddit has a consensus price target of $221.10, suggesting a potential upside of 43.40%. Given Hello Group’s higher possible upside, research analysts clearly believe Hello Group is more favorable than Reddit.
Insider & Institutional Ownership
51.0% of Hello Group shares are held by institutional investors. 61.4% of Hello Group shares are held by company insiders. Comparatively, 28.5% of Reddit shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Hello Group and Reddit’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hello Group | 11.02% | 10.43% | 8.41% |
| 31.35% | 29.02% | 26.32% |
Risk and Volatility
Hello Group has a beta of 0.45, meaning that its stock price is 55% less volatile than the S&P 500. Comparatively, Reddit has a beta of 2.02, meaning that its stock price is 102% more volatile than the S&P 500.
Valuation & Earnings
This table compares Hello Group and Reddit”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Hello Group | $1.48 billion | 0.39 | $114.97 million | $0.98 | 5.48 |
| $2.20 billion | 13.47 | $529.72 million | $4.30 | 35.86 |
Reddit has higher revenue and earnings than Hello Group. Hello Group is trading at a lower price-to-earnings ratio than Reddit, indicating that it is currently the more affordable of the two stocks.
Summary
Reddit beats Hello Group on 12 of the 15 factors compared between the two stocks.
About Hello Group
Hello Group Inc. provides mobile-based social and entertainment services in the People's Republic of China. It operates in three segments: Momo, Tantan, and QOOL. The company offers Momo, a mobile application that connects people and facilitates social interactions based on location, interests, and various online recreational activities, including live talent shows, short videos, social games, as well as other video- and audio-based interactive experiences, such as online parties, mobile karaoke and user participated reality shows; Tantan, a social and dating application; and other applications under the Hertz, Soulchill, Duidui, and Tietie names. The company also provides livestream services for various content and activities comprising talent shows, such as singing, dancing, and talk shows, as well as casual chatting, and other forms of interactions between broadcasters and viewers; value-added services; advertising and marketing services; and mobile games. The company was formerly known as Momo Inc. and changed its name to Hello Group Inc. in August 2021. Hello Group Inc. was incorporated in 2011 and is headquartered in Beijing, the People's Republic of China.
About Reddit
Reddit, Inc. operates a website that organizes digital communities. It organizes communities based on specific interests that enable users to engage in conversations by sharing experiences, submitting links, uploading images and videos, and replying to one another. The company was founded in 2005 and is headquartered in San Francisco, California.