Critical Analysis: West Corporation (WSTC) & Ixia (XXIA)
West Corporation (NASDAQ: WSTC) and Ixia (NASDAQ:XXIA) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.
This is a breakdown of current recommendations for West Corporation and Ixia, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
West Corporation currently has a consensus price target of $24.50, suggesting a potential upside of 4.97%. Ixia has a consensus price target of $19.65, suggesting a potential upside of 0.00%. Given West Corporation’s higher probable upside, research analysts plainly believe West Corporation is more favorable than Ixia.
Earnings and Valuation
This table compares West Corporation and Ixia’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|West Corporation||$2.29 billion||0.85||$636.33 million||$2.51||9.30|
West Corporation has higher revenue and earnings than Ixia. West Corporation is trading at a lower price-to-earnings ratio than Ixia, indicating that it is currently the more affordable of the two stocks.
This table compares West Corporation and Ixia’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
West Corporation has a beta of 1.59, meaning that its share price is 59% more volatile than the S&P 500. Comparatively, Ixia has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500.
Institutional & Insider Ownership
68.6% of West Corporation shares are held by institutional investors. Comparatively, 63.6% of Ixia shares are held by institutional investors. 4.6% of West Corporation shares are held by insiders. Comparatively, 24.4% of Ixia shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
West Corporation pays an annual dividend of $0.68 per share and has a dividend yield of 2.9%. Ixia does not pay a dividend. West Corporation pays out 27.1% of its earnings in the form of a dividend.
West Corporation beats Ixia on 8 of the 13 factors compared between the two stocks.
About West Corporation
West Corporation is a provider of communication and network infrastructure services. The Company helps its clients communicate, collaborate and connect with their audiences through a portfolio of solutions that include unified communications services, safety services, and interactive services, such as automated notifications, specialized agent services and telecom services. The Company’s segments include Unified Communications Services, which includes collaboration services, Unified Communications as a Service (UCaaS) and telecom services; Safety Services, which includes carrier services, government solutions and advanced services; Interactive Services, including outbound (proactive notifications-voice, text/short messaging service (SMS) and chat), inbound speech solutions (interactive voice response or IVR), Web, mobile and professional services, and Specialized Agent Services, which includes healthcare advocacy services, cost management services and revenue generation.
Ixia is a provider of physical and virtual network application performance and security resilience solutions. The Company’s product solutions consist of its hardware platforms, software applications and services, including warranty and maintenance offerings. The Company helps its customers to validate the performance and security resilience of their applications and networks. The Company offers network test hardware platforms with interchangeable interfaces, using a common set of applications and Application Programing Interfaces (APIs). The Company provides its solutions to network equipment manufacturers (NEMs), service providers, and enterprise and government organizations. The Company’s product solutions consist of its hardware platforms, such as chassis, interface cards and appliances, software application tools, and services, including its warranty and maintenance offerings and professional services.
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