Brocade Communications Systems (NASDAQ: BRCD) and Airgain (NASDAQ:AIRG) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, valuation, risk, analyst recommendations and earnings.
This table compares Brocade Communications Systems and Airgain’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Brocade Communications Systems||-3.56%||-3.07%||-1.62%|
This table compares Brocade Communications Systems and Airgain’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Brocade Communications Systems||$2.35 billion||2.24||$213.81 million||$0.07||181.29|
|Airgain||$49.52 million||1.76||$1.14 million||$0.11||82.64|
Brocade Communications Systems has higher revenue and earnings than Airgain. Airgain is trading at a lower price-to-earnings ratio than Brocade Communications Systems, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
83.7% of Brocade Communications Systems shares are owned by institutional investors. Comparatively, 27.2% of Airgain shares are owned by institutional investors. 1.8% of Brocade Communications Systems shares are owned by company insiders. Comparatively, 23.4% of Airgain shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This is a breakdown of current recommendations and price targets for Brocade Communications Systems and Airgain, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Brocade Communications Systems||1||3||0||0||1.75|
Brocade Communications Systems presently has a consensus target price of $12.83, indicating a potential upside of 1.13%. Airgain has a consensus target price of $14.00, indicating a potential upside of 54.02%. Given Airgain’s stronger consensus rating and higher possible upside, analysts clearly believe Airgain is more favorable than Brocade Communications Systems.
Brocade Communications Systems pays an annual dividend of $0.22 per share and has a dividend yield of 1.7%. Airgain does not pay a dividend. Brocade Communications Systems pays out 314.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Volatility and Risk
Brocade Communications Systems has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500. Comparatively, Airgain has a beta of 1.71, meaning that its share price is 71% more volatile than the S&P 500.
Airgain beats Brocade Communications Systems on 10 of the 16 factors compared between the two stocks.
About Brocade Communications Systems
Brocade Communications Systems, Inc. (Brocade) is a supplier of networking hardware, software and services, including storage area networking (SAN) solutions and Internet protocol (IP) networking solutions for businesses and organizations of various types and sizes. The Company operates through three segments: SAN Products, IP Networking Products and Global Services. The SAN Products segment includes infrastructure products and solutions that help customers develop and deploy storage and server consolidation, disaster recovery and data security. The IP Networking Products segment includes Layer 2 and Layer 3 Ethernet switches, and routers to connect users over private and public networks. The Global Services segment includes break or fix maintenance, installation, consulting, network management and software maintenance, and post-contract customer support. Its products enable customers to deploy architectures and technologies, including virtualization and cloud computing.
Airgain, Inc. is a provider of embedded antenna technologies used to enable wireless networking across a range of home, enterprise and industrial devices. The Company’s antennas are found in devices deployed in carrier, enterprise and residential wireless networks and systems, including set top boxes, access points, routers, gateways and digital televisions. It offers six product lines, including MaxBeam High Gain Embedded Antennas, Profile Embedded Antennas, Profile Contour Embedded Antennas, Ultra Embedded Antennas, OmniMax High Performance External Antennas and MaxBeam Carrier Class Antennas. The Company, through its design, integration and testing of embedded antenna technology, provides its technology to the residential wireless local area network, wireless fidelity and antenna market, and also supplies to carriers, original equipment manufacturers, original design manufacturers and system designers. The Company supplies its products in the United States, Europe, Canada and Asia.
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