Head to Head Review: Microwave Filter (OTCMKTS:MFCO) and Data I/O (NASDAQ:DAIO)

Data I/O (NASDAQ:DAIO) and Microwave Filter (OTCMKTS:MFCO) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, earnings, risk, institutional ownership and profitability.

Risk and Volatility

Data I/O has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500. Comparatively, Microwave Filter has a beta of 0.49, suggesting that its share price is 51% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Data I/O and Microwave Filter, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Data I/O	1	1	2	1	2.60
Microwave Filter	0	0	0	0	0.00

Data I/O currently has a consensus target price of $5.11, indicating a potential upside of 82.50%. Given Data I/O’s stronger consensus rating and higher possible upside, analysts clearly believe Data I/O is more favorable than Microwave Filter.

Profitability

This table compares Data I/O and Microwave Filter’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Data I/O	-16.16%	-21.44%	-15.24%
Microwave Filter	N/A	N/A	N/A

Insider and Institutional Ownership

37.0% of Data I/O shares are owned by institutional investors. 7.3% of Data I/O shares are owned by company insiders. Comparatively, 6.9% of Microwave Filter shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Data I/O and Microwave Filter”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Data I/O	$21.77 million	1.21	-$3.09 million	($0.40)	-7.00
Microwave Filter	$2.18 million	0.79	-$260,000.00	N/A	N/A

Microwave Filter has lower revenue, but higher earnings than Data I/O.

Summary

Data I/O beats Microwave Filter on 9 of the 13 factors compared between the two stocks.

About Data I/O

Data I/O Corporation, together with its subsidiaries, engages in the design, manufacture, and sale of programming and security deployment systems and services for electronic device manufacturers in the United States, Europe, and internationally. Its programming system products are used to program integrated circuits (ICs) with the specific data for the ICs. The company offers PSV handlers off-line automated programming systems, such as PSV2800 automated programming system which focuses on high-volume manufacturing in a lower cost platform; PSV7000 automated programming system for security deployment upgrades; PSV5000 automated programming system that combines mid-range capacity and supports security deployment; and PSV3500 automated programming system which provides basic programming needs. It also provides SentriX security deployment system; and LumenX and non-automated FlashPAK III programming systems. In addition, the company offers hardware support, system installation and repair, and device programming services. It markets and sells its products to original equipment manufacturers in automotive and consumer electronics, internet of things, and industrial, as well as electronic manufacturing service contract manufacturers through direct sales, and indirect sales representatives and distributors. Data I/O Corporation was incorporated in 1969 and is headquartered in Redmond, Washington.

About Microwave Filter

Microwave Filter Company, Inc. designs, develops, manufactures, and sells electronic filters for radio and microwave frequencies primarily in the United States. It manufactures RF filters and related components for eliminating interference and facilitating signal processing for cable television, broadcast, commercial and military communications, avionics, radar, navigation, and defense markets. The company also designs waveguide, stripline/microstrip, transmission line, miniature/subminiature, and lumped constant filters. Its configurations include bandpass, highpass, lowpass, bandstop, multiplexers, tunable notch, tunable bandpass, high power filters, amplitude equalized, delay equalized, and filter networks. The company serves 5G, cable television, television and radio broadcast, satellite broadcast, mobile radio, commercial, and aerospace and defense electronics markets. Microwave Filter Company, Inc. was incorporated in 1967 and is based in East Syracuse, New York.