Comparing Datasea (NASDAQ:DTSS) and SecureWorks (NASDAQ:SCWX)

SecureWorks (NASDAQ:SCWX) and Datasea (NASDAQ:DTSS) are both small-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Volatility and Risk

SecureWorks has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500. Comparatively, Datasea has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500.

Profitability

This table compares SecureWorks and Datasea’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SecureWorks	-25.49%	-5.71%	-3.93%
Datasea	-26.69%	-618.32%	-245.91%

Analyst Ratings

This is a breakdown of recent ratings for SecureWorks and Datasea, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SecureWorks	1	1	0	0	1.50
Datasea	0	0	0	0	0.00

SecureWorks presently has a consensus target price of $7.00, indicating a potential downside of 17.74%. Given SecureWorks’ stronger consensus rating and higher probable upside, research analysts clearly believe SecureWorks is more favorable than Datasea.

Earnings & Valuation

This table compares SecureWorks and Datasea”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SecureWorks	$365.88 million	2.07	-$86.04 million	($0.99)	-8.60
Datasea	$47.28 million	0.34	-$11.38 million	N/A	N/A

Datasea has lower revenue, but higher earnings than SecureWorks.

Institutional & Insider Ownership

14.4% of SecureWorks shares are held by institutional investors. Comparatively, 82.1% of Datasea shares are held by institutional investors. 81.5% of SecureWorks shares are held by insiders. Comparatively, 41.1% of Datasea shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

SecureWorks beats Datasea on 9 of the 11 factors compared between the two stocks.

About SecureWorks

SecureWorks Corp., through its subsidiaries, provides technology-driven information security solutions for protecting its customers in the United States and internationally. The company's solutions include software-as-a-service solutions; managed security services; and professional services, including incident response and penetration testing services. Its solutions enable organizations to prevent security breaches, detect malicious activity, respond rapidly to security breaches, and identify emerging threats. The company sells its solutions primarily through its referral agents, regional value-added resellers, trade associations, and managed security service providers. It serves customers in a range of industries, including financial services, manufacturing, technology, retail, insurance, utility, and healthcare sectors. The company was formerly known as SecureWorks Holding Corporation and changed its name to SecureWorks Corp. in November 2015. SecureWorks Corp. was founded in 1999 and is headquartered in Atlanta, Georgia. SecureWorks Corp. is a subsidiary of Dell Marketing L.P.

About Datasea

Datasea Inc., through its subsidiaries, provides technology and information systems in the People's Republic of China. The company provides smart city solutions and 5G messaging applications. It also offers its smart security solutions primarily to schools, tourist or scenic attractions, and public communities. In addition, the company provides intelligent acoustics products, which include ultrasonic air sterilizer, air purification and deodorization, and other products. The company was formerly known as Rose Rock, Inc. and changed its name to Datasea Inc. in October 2015. Datasea Inc. was incorporated in 2014 and is headquartered in Beijing, the People's Republic of China.