Head to Head Review: Acacia Communications (ACIA) versus CommScope Holding Company (COMM)
CommScope Holding Company (NASDAQ: COMM) and Acacia Communications (NASDAQ:ACIA) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitabiliy, dividends, risk, valuation, earnings and institutional ownership.
Valuation and Earnings
This table compares CommScope Holding Company and Acacia Communications’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|CommScope Holding Company||$4.92 billion||1.48||$1.14 billion||$1.25||30.23|
|Acacia Communications||$508.59 million||3.08||$141.94 million||$3.70||10.97|
CommScope Holding Company has higher revenue and earnings than Acacia Communications. Acacia Communications is trading at a lower price-to-earnings ratio than CommScope Holding Company, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
CommScope Holding Company has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Acacia Communications has a beta of 3.81, meaning that its stock price is 281% more volatile than the S&P 500.
This is a breakdown of current recommendations and price targets for CommScope Holding Company and Acacia Communications, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|CommScope Holding Company||0||2||8||0||2.80|
CommScope Holding Company presently has a consensus target price of $43.89, suggesting a potential upside of 16.14%. Acacia Communications has a consensus target price of $65.50, suggesting a potential upside of 61.41%. Given Acacia Communications’ higher probable upside, analysts clearly believe Acacia Communications is more favorable than CommScope Holding Company.
Institutional & Insider Ownership
97.9% of CommScope Holding Company shares are held by institutional investors. Comparatively, 90.0% of Acacia Communications shares are held by institutional investors. 3.3% of CommScope Holding Company shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
This table compares CommScope Holding Company and Acacia Communications’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|CommScope Holding Company||4.96%||36.96%||7.03%|
CommScope Holding Company Company Profile
CommScope Holding Company, Inc. (CommScope) is a provider of infrastructure solutions for the core, access and edge layers of communications networks. The Company operates through two segments: CommScope Connectivity Solutions (CCS) and CommScope Mobility Solutions (CMS). Its portfolio includes wireless and fiber optic solutions. The Company’s solutions are found in the venues and outdoor spaces, including in data centers and buildings of all shapes, sizes and complexities; at wireless cell sites; in telecom central offices and cable head ends; in fiber-to-the-X (FTTX) deployments, and in airports, trains and tunnels. As of December 31, 2016, it served customers in over 100 countries through a network of more than 30 manufacturing and distribution facilities located around the globe. Its customers include global telecommunication operators and enterprise customers, including Fortune 500 enterprises and multi-system operators (MSOs).
Acacia Communications Company Profile
Acacia Communications, Inc. provides high-speed coherent interconnect products. The Company’s products include a series of low-power coherent digital signal processor application-specific integrated circuits (DSP ASICs), and silicon photonic integrated circuits (silicon PICs), which it has integrated into families of optical interconnect modules with transmission speeds ranging from 100 to 400 gigabits per second (Gbps) for use in long-haul, metro and inter-data center markets. The Company is also developing optical interconnect modules that will enable transmission speeds of one terabit (1,000 gigabits) per second and above. The Company’s modules perform a majority of the digital signal processing and optical functions in optical interconnects. The Company’s coherent DSP ASICs are manufactured using complementary metal oxide semiconductor (CMOS), and its silicon PICs are manufactured using a CMOS-compatible process.
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