Contrasting Skillz (NYSE:SKLZ) & CSG Systems International (NASDAQ:CSGS)

Skillz (NYSE:SKLZ) and CSG Systems International (NASDAQ:CSGS) are both small-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Skillz and CSG Systems International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Skillz	-74.59%	-50.98%	-25.00%
CSG Systems International	5.67%	27.67%	6.63%

Institutional and Insider Ownership

19.4% of Skillz shares are owned by institutional investors. Comparatively, 91.1% of CSG Systems International shares are owned by institutional investors. 22.7% of Skillz shares are owned by company insiders. Comparatively, 3.1% of CSG Systems International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Skillz and CSG Systems International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Skillz	0	2	2	0	2.50
CSG Systems International	0	1	5	0	2.83

Skillz currently has a consensus price target of $11.50, suggesting a potential upside of 91.67%. CSG Systems International has a consensus price target of $63.00, suggesting a potential upside of 31.25%. Given Skillz’s higher possible upside, equities analysts plainly believe Skillz is more favorable than CSG Systems International.

Valuation and Earnings

This table compares Skillz and CSG Systems International’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Skillz	$167.85 million	0.77	-$106.69 million	($5.46)	-1.10
CSG Systems International	$1.17 billion	1.21	$66.25 million	$2.19	21.92

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

Risk and Volatility

Skillz has a beta of 2.83, meaning that its stock price is 183% more volatile than the S&P 500. Comparatively, CSG Systems International has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500.

Summary

CSG Systems International beats Skillz on 11 of the 14 factors compared between the two stocks.

About Skillz

Skillz Inc. operates a mobile game platform in the United States and internationally. The company primarily develops and supports a proprietary online-hosted technology platform that enables independent game developers to host tournaments and provide competitive gaming activity to end-users. The company distributes games through direct app download from its website, as well as through third-party platforms. Skillz Inc. was founded in 2012 and is based in San Francisco, California.

About CSG Systems International

CSG Systems International, Inc., together with its subsidiaries, provides revenue management and digital monetization, customer experience, and payment solutions primarily to the communications industry in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It offers Advanced Convergent Platform, a private SaaS platform; and related solutions, including service technician management, analytics, electronic bill presentment, etc. The company also provides a public SaaS-based revenue management and payments platform. In addition, it offers managed services; and professional services to implement, configure, and maintain its solutions, as well as licenses various solutions, such as mediation, partner management, rating, and charging. Further, the company provides operational services, including infrastructure management comprised of hardware, application, and environmental management; application configuration management, such as configuration development, release, and deployment; and business operations management, which includes event processing, revenue management, and settlement. It serves retail, financial services, healthcare, insurance, and government entities. The company was incorporated in 1994 and is headquartered in Englewood, Colorado.