Extreme Networks (NASDAQ: EXTR) and Aviat Networks (NASDAQ:AVNW) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, profitabiliy, institutional ownership, dividends, analyst recommendations and valuation.

Insider & Institutional Ownership

82.9% of Extreme Networks shares are owned by institutional investors. Comparatively, 47.9% of Aviat Networks shares are owned by institutional investors. 1.9% of Extreme Networks shares are owned by insiders. Comparatively, 6.7% of Aviat Networks shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Extreme Networks and Aviat Networks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Extreme Networks -4.12% 33.40% 7.20%
Aviat Networks -5.95% -13.23% -4.55%

Analyst Recommendations

This is a summary of recent recommendations for Extreme Networks and Aviat Networks, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Extreme Networks 0 1 3 0 2.75
Aviat Networks 0 0 0 0 N/A

Extreme Networks currently has a consensus price target of $8.25, suggesting a potential downside of 13.25%. Given Extreme Networks’ higher probable upside, analysts plainly believe Extreme Networks is more favorable than Aviat Networks.

Risk and Volatility

Extreme Networks has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500. Comparatively, Aviat Networks has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500.

Valuation & Earnings

This table compares Extreme Networks and Aviat Networks’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Extreme Networks $559.03 million 1.87 $34.08 million ($0.21) -45.29
Aviat Networks $243.70 million 0.41 -$5.71 million ($2.77) -6.83

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

Summary

Extreme Networks beats Aviat Networks on 11 of the 12 factors compared between the two stocks.

Extreme Networks Company Profile

Extreme Networks, Inc. is a provider of network infrastructure equipment. The Company markets its products to business, governmental, healthcare, service provider and educational customers with a focus on corporate enterprises and metropolitan service providers on a global basis. The Company operates through the development and marketing of network infrastructure equipment segment. The Company’s products include ExtremeWireless, ExtremeSwitching, ExtremeControl, ExtremeManagement, ExtremeCloud, ExtremeAnalytics and ExtremeSecurity. The Company offers solutions in categories, which includes industry solutions, technology solutions and managed services solutions. The Company operates in three geographical areas: Americas, which includes the United States, Canada, Mexico, Central America and South America; EMEA, which includes Europe, Russia, Middle East and Africa, and APAC, which includes Asia Pacific, South Asia, India, Australia and Japan.

Aviat Networks Company Profile

Aviat Networks, Inc., together with its subsidiaries, is a supplier of microwave networking solutions. The Company’s product categories include point-to-point microwave and millimeter wave radios that are licensed (subject to local frequency regulatory requirements), lightly-licensed and license-exempt (operating in license-exempt frequencies), and element and network management software. In addition, it provides a range of professional services enabling it to deliver turnkey networks, including design, deployment, maintenance and managed services. It designs, manufactures and sells a range of wireless networking products, solutions and services to mobile and fixed public network operators, private network operators, Federal, State and Local government agencies, transportation, energy and utility companies, public safety agencies and broadcast network operators around the world. The Company sells products and services directly to its customers and also use agents and resellers.

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