Reddit Inc. (RDDT) vs Tencent Music Entertainment Group Sponsored ADR (TME)

Reddit Inc. and Tencent Music Entertainment Group Sponsored ADR are both Internet Content & Information companies. Reddit Inc. is the larger, with a market value of $18.1B against $6.0B — 3.0× the size. Tencent Music Entertainment Group Sponsored ADR trades at the lower P/E: 11.4× against 18.2×. Reddit Inc. grew revenue faster over the last twelve months: 62.2% against 17.8%. Reddit Inc. has the higher net margin (32.1% vs 26.4%) and the higher return on invested capital (103.5% vs 9.92%). Across the 20 metrics below, Reddit Inc. leads on 11 and Tencent Music Entertainment Group Sponsored ADR on 9.

Valuation

Metric RDDT TME Internet Content & Information median
P/E 18.25 11.37 12.38
P/S 5.88 3.05 0.93
P/B 5.07 1.24 1.24
Price to free cash flow 15.17 14.71 10.76
EV/EBITDA 16.37 8.28 10.74
EV/Sales 4.90 2.43 1.20
Earnings yield 5.48% 8.79% (1.71%)
Free cash flow yield 6.59% 6.80% 4.26%

Profitability

Metric RDDT TME Internet Content & Information median
Gross margin 91.55% 44.34% 63.25%
Operating margin 29.40% 29.41% (1.87%)
Net margin 32.11% 26.37% (1.37%)
Free cash flow margin 38.79% 33.20% 3.47%
Return on equity 32.03% 10.65% (1.19%)
Return on assets 29.00% 7.91% 0.00%
Return on invested capital 103.51% 9.92% 0.00%

Growth

Metric RDDT TME Internet Content & Information median
Revenue growth (TTM) 62.18% 17.81% 6.92%
EPS growth (last fiscal year) 178.68% 75.86% 34.37%
Revenue growth, 5-year CAGR — 1.62% 10.46%
Net income growth, 5-year CAGR — 20.63% 0.00%

Health

Metric RDDT TME Internet Content & Information median
Debt to equity 0.00 0.13 0.01
Current ratio 10.80 1.74 1.84
Net debt to EBITDA (5.41) (1.88) (0.53)

Dividend

Metric RDDT TME Internet Content & Information median
Dividend yield — 2.54% 1.19%
Payout ratio — 0.30 0.27

Size

Metric RDDT TME Internet Content & Information median
Market cap 18.11b 5.96b 693.23m

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