Contrasting Monotype Imaging (NASDAQ:TYPE) & Its Peers

Monotype Imaging (NASDAQ: TYPE) is one of 36 public companies in the “Custom computer programming services” industry, but how does it contrast to its competitors? We will compare Monotype Imaging to related businesses based on the strength of its valuation, institutional ownership, profitability, analyst recommendations, earnings, risk and dividends.

Dividends

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Monotype Imaging pays an annual dividend of $0.46 per share and has a dividend yield of 2.0%. Monotype Imaging pays out 86.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Custom computer programming services” companies pay a dividend yield of 1.3% and pay out 29.4% of their earnings in the form of a dividend.

Valuation & Earnings

This table compares Monotype Imaging and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Monotype Imaging $235.79 million $11.56 million 43.68
Monotype Imaging Competitors $1.99 billion $183.99 million -1.00

Monotype Imaging’s competitors have higher revenue and earnings than Monotype Imaging. Monotype Imaging is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a summary of recent recommendations for Monotype Imaging and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Monotype Imaging 1 0 1 0 2.00
Monotype Imaging Competitors 163 791 1476 52 2.57

Monotype Imaging currently has a consensus price target of $27.50, suggesting a potential upside of 18.79%. As a group, “Custom computer programming services” companies have a potential upside of 38.77%. Given Monotype Imaging’s competitors stronger consensus rating and higher probable upside, analysts plainly believe Monotype Imaging has less favorable growth aspects than its competitors.

Profitability

This table compares Monotype Imaging and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Monotype Imaging 4.90% 6.10% 3.73%
Monotype Imaging Competitors 2.85% -22.29% 5.12%

Volatility and Risk

Monotype Imaging has a beta of 0.8, meaning that its share price is 20% less volatile than the S&P 500. Comparatively, Monotype Imaging’s competitors have a beta of 1.00, meaning that their average share price is 0% more volatile than the S&P 500.

Insider and Institutional Ownership

93.4% of Monotype Imaging shares are held by institutional investors. Comparatively, 55.3% of shares of all “Custom computer programming services” companies are held by institutional investors. 2.3% of Monotype Imaging shares are held by company insiders. Comparatively, 14.5% of shares of all “Custom computer programming services” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Monotype Imaging competitors beat Monotype Imaging on 10 of the 15 factors compared.

Monotype Imaging Company Profile

Monotype Imaging Holdings Inc. is engaged in the development, marketing and licensing of technologies and fonts. The Company empowers expression and engagement for creatives, designers, engineers and marketers. It organizes its business operations into two areas: creative professionals and original equipment manufacturer (OEM). For Creative Professional market, it provides content across multiple devices and mediums. Its solutions, which include type, branded mobile content, visual content marketing solutions, custom design services, and tools and technologies that enable the creative process, are licensed through its direct sales channel, e-commerce platforms and partner platforms. It also provides consumer device manufacturers and independent software vendors with the right solutions for delivering consistent, compelling user experiences. It works with a range of customers, including brands, agencies and publishers. As of December 31, 2016, it offered over 17,000 typeface designs.

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