Head-To-Head Analysis: Plantronics (PLT) & Harmonic (HLIT)

Harmonic (NASDAQ: HLIT) and Plantronics (NYSE:PLT) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Valuation & Earnings

This table compares Harmonic and Plantronics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Harmonic $358.25 million 0.92 -$82.95 million ($0.54) -7.22
Plantronics $881.18 million 2.25 $82.59 million $2.48 24.15

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

Dividends

Plantronics pays an annual dividend of $0.60 per share and has a dividend yield of 1.0%. Harmonic does not pay a dividend. Plantronics pays out 24.2% of its earnings in the form of a dividend.

Institutional & Insider Ownership

91.8% of Harmonic shares are owned by institutional investors. Comparatively, 94.1% of Plantronics shares are owned by institutional investors. 4.3% of Harmonic shares are owned by insiders. Comparatively, 3.2% of Plantronics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Harmonic has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Plantronics has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.

Profitability

This table compares Harmonic and Plantronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Harmonic -23.16% -17.41% -7.76%
Plantronics 1.03% 22.22% 8.11%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Harmonic and Plantronics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Harmonic 0 1 2 0 2.67
Plantronics 0 1 3 0 2.75

Harmonic currently has a consensus target price of $5.33, suggesting a potential upside of 36.75%. Plantronics has a consensus target price of $60.00, suggesting a potential upside of 0.17%. Given Harmonic’s higher probable upside, analysts plainly believe Harmonic is more favorable than Plantronics.

Summary

Plantronics beats Harmonic on 13 of the 16 factors compared between the two stocks.

Harmonic Company Profile

Harmonic Inc. designs, manufactures, and sells video infrastructure products and system solutions worldwide. Its products enable customers to create, prepare, and deliver a range of video and broadband services to consumer devices, including televisions, personal computers, laptops, tablets, and smart phones. The company operates in two segments, Video and Cable Edge. The Video segment sells video processing, and production and playout solutions and services to cable operators, and satellite and telecommunications Pay-TV service providers, as well as to broadcast and media companies, including streaming new media companies. This segment's video processing solutions include network management and application software, and hardware products, such as cloud media processing, broadcast and distribution encoders, contribution encoders, multiscreen transcoders and stream processing systems, multiscreen delivery, decoders and descramblers, and video servers. This segment also provides video-optimized storage systems; and unified video playout and processing software-as-a-service solutions. The Cable Edge segment offers cable edge solutions and related services, including CableOS software-based converged cable access platform solutions; and narrowcast services gateway products primarily to cable operators. The company also provides technical support and professional services, such as maintenance and support, consulting, implementation, program management, technical design and planning, building and site preparation, integration and equipment installation, system testing, and training. Harmonic Inc. sells its products through its direct sales force, as well as through independent resellers and systems integrators. The company was founded in 1988 and is headquartered in San Jose, California.

Plantronics Company Profile

Plantronics, Inc. designs, manufactures, and markets lightweight communications headsets, telephone headset systems, other communication endpoints, and accessories for the business and consumer markets under the Plantronics brand worldwide. The company also manufactures and markets specialty telephone products under the Clarity brand. Its primary products include corded and cordless communication headsets; audio processors; telephone systems; Bluetooth and corded products; personal computer and gaming headsets; and specialty products for hearing impaired individuals. The company designs its products for various markets and applications, such as offices and homes, contact centers, mobile phones and smartphones, tablets, computer and gaming, residential, and other specialty applications. Plantronics, Inc. sells its products through a network of distributors, retailers, wireless carriers, original equipment manufacturers, and telephony and other service providers. The company was founded in 1961 and is headquartered in Santa Cruz, California.

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