NETGEAR (NASDAQ: NTGR) and KVH Industries (NASDAQ:KVHI) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their profitabiliy, valuation, institutional ownership, dividends, risk, analyst recommendations and earnings.

Valuation & Earnings

This table compares NETGEAR and KVH Industries’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
NETGEAR $1.34 billion 1.06 $143.73 million $2.22 19.71
KVH Industries $175.95 million 0.94 $9.16 million ($0.60) -16.25

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

Institutional and Insider Ownership

98.8% of NETGEAR shares are owned by institutional investors. Comparatively, 64.8% of KVH Industries shares are owned by institutional investors. 6.2% of NETGEAR shares are owned by insiders. Comparatively, 11.1% of KVH Industries shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for NETGEAR and KVH Industries, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NETGEAR 1 2 4 0 2.43
KVH Industries 0 0 2 0 3.00

NETGEAR presently has a consensus price target of $63.00, suggesting a potential upside of 44.00%. KVH Industries has a consensus price target of $9.50, suggesting a potential downside of 2.56%. Given NETGEAR’s higher possible upside, equities analysts plainly believe NETGEAR is more favorable than KVH Industries.

Risk & Volatility

NETGEAR has a beta of 1.53, meaning that its stock price is 53% more volatile than the S&P 500. Comparatively, KVH Industries has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.

Profitability

This table compares NETGEAR and KVH Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NETGEAR 5.61% 11.30% 7.90%
KVH Industries -5.46% 2.17% 1.15%

Summary

NETGEAR beats KVH Industries on 11 of the 14 factors compared between the two stocks.

NETGEAR Company Profile

NETGEAR, Inc. designs, develops and markets networking solutions and smart connected products for consumers, businesses and service providers. The Company’s product line consists of devices, such as network attached storage, Internet protocol (IP) security cameras, and home automation devices and services. The Company’s segments include retail, commercial and service provider. The retail business unit is focused on individual consumers and consists of whole home wireless fidelity (WiFi) networking solutions and Smart connected products. The commercial business unit is focused on small and medium-sized businesses and consists of business networking, storage and security solutions. The service provider business unit is focused on the service provider market and consists of made-to-order and retail-proven whole home networking hardware and software solutions, including fourth-generation (4G) long term evolution (LTE) hotspots sold to service providers for sale to their subscribers.

KVH Industries Company Profile

KVH Industries, Inc. is a manufacturer of solutions that provide high-speed Internet, television and voice services through satellite to mobile users at sea and on land. The Company also provides commercially licensed entertainment, including news, sports, music and movies, to commercial and leisure customers in the maritime, hotel and retail markets. It operates in two geographic segments, in the mobile communications, navigation and guidance and stabilization equipment industry. The Company develops and distributes training films and e-learning computer-based training courses to commercial maritime customers. It is also a manufacturer of navigational sensors and integrated inertial systems for defense and commercial guidance and stabilization applications. It designs, develops, manufactures and markets mobile communications products and services for the marine and land mobile markets, and navigation, guidance and stabilization products for both the commercial and defense markets.

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