Head-To-Head Comparison: Sequans Communications (SQNS) & Arrow Electronics (NYSE:ARW)

Arrow Electronics (NYSE: ARW) and Sequans Communications (NYSE:SQNS) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Insider and Institutional Ownership

92.9% of Arrow Electronics shares are owned by institutional investors. Comparatively, 31.5% of Sequans Communications shares are owned by institutional investors. 1.2% of Arrow Electronics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Arrow Electronics and Sequans Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Arrow Electronics 2.00% 13.63% 4.48%
Sequans Communications -46.93% -256.90% -34.40%

Risk & Volatility

Arrow Electronics has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Sequans Communications has a beta of 2.42, suggesting that its share price is 142% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Arrow Electronics and Sequans Communications, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Arrow Electronics 0 1 1 0 2.50
Sequans Communications 0 0 7 0 3.00

Arrow Electronics currently has a consensus target price of $83.50, suggesting a potential upside of 0.17%. Sequans Communications has a consensus target price of $3.86, suggesting a potential upside of 113.10%. Given Sequans Communications’ stronger consensus rating and higher possible upside, analysts clearly believe Sequans Communications is more favorable than Arrow Electronics.

Earnings and Valuation

This table compares Arrow Electronics and Sequans Communications’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Arrow Electronics $23.83 billion 0.31 $522.75 million $5.68 14.68
Sequans Communications $45.58 million 3.15 -$24.78 million ($0.31) -5.84

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

Summary

Arrow Electronics beats Sequans Communications on 9 of the 14 factors compared between the two stocks.

About Arrow Electronics

Arrow Electronics, Inc. is a provider of products, services and solutions to industrial and commercial users of electronic components and enterprise computing solutions. The Company has a portfolio of product offerings available from various electronic components and enterprise computing solutions suppliers. The Company’s segments include the global components business; the global enterprise computing solutions (ECS) business, and corporate business segment. It distributes electronic components to original equipment manufacturers and contract manufacturers through its global components business segment. Through global ECS business segment, it provides enterprise computing solutions to value-added resellers. The Global components segment markets and distributes electronic components and provides a range of value-added capabilities. Global ECS’ portfolio of computing solutions includes datacenter, cloud, security, and analytics solutions.

About Sequans Communications

Sequans Communications S.A. is a fabless designer, developer and supplier of fourth Generation long term evolution (4G LTE) semiconductor solutions for wireless broadband applications, with a specific focus on the single-mode device market. Its semiconductor solutions integrate baseband processor and radio frequency (RF) transceiver integrated circuits (ICs) along with its signal processing techniques, algorithms and software stacks. In the broadband data device market, its solutions serve as the wireless communications platform in devices, such as smartphones; Universal Serial Bus (USB) dongles; portable routers; embedded wireless modems for laptops, tablets, and other consumer multimedia devices; and customer-premises equipment, such as fixed wireless access modems, routers and residential gateways. The Company’s products include SQN3330, SQN3223, SQN3221, SQN3241, VZ120Q, VZ22Q, VZ22M, US60L, SQN3220, SQN3240, SQN3120, SQN5120, SQN3140, VZ20Q, VZ20M, SQN1210 and SQN1220.

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