Alcatel Lucent SA (NYSE: ALU) and EMCORE Corporation (NASDAQ:EMKR) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.

Profitability

This table compares Alcatel Lucent SA and EMCORE Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alcatel Lucent SA 14.83% 86.14% 10.96%
EMCORE Corporation 6.73% 9.25% 7.71%

Institutional and Insider Ownership

76.3% of EMCORE Corporation shares are owned by institutional investors. 0.8% of EMCORE Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Alcatel Lucent SA and EMCORE Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Alcatel Lucent SA N/A N/A N/A N/A N/A
EMCORE Corporation $119.32 million 1.97 $13.00 million $0.30 29.17

EMCORE Corporation has higher revenue and earnings than Alcatel Lucent SA.

Analyst Ratings

This is a summary of current ratings and recommmendations for Alcatel Lucent SA and EMCORE Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alcatel Lucent SA 0 0 0 0 N/A
EMCORE Corporation 0 1 2 0 2.67

EMCORE Corporation has a consensus price target of $11.50, indicating a potential upside of 31.43%. Given EMCORE Corporation’s higher possible upside, analysts plainly believe EMCORE Corporation is more favorable than Alcatel Lucent SA.

Summary

EMCORE Corporation beats Alcatel Lucent SA on 5 of the 9 factors compared between the two stocks.

Alcatel Lucent SA Company Profile

Alcatel Lucent SA is a provider of Internet protocol (IP) networking, ultra-broadband access and cloud technology solutions. The Company operates through two segments for the networks business. The Ultra Broadband Networks segment consists of Mobile Networks and Fixed Networks business groups. The IP Networks and Applications segment consists of Internet protocol (IP)/Optical Networks and Applications and Analytics business groups. Its other segment consists of businesses run as separate operations (Alcatel Submarine Networks and Radio Frequency Systems (RFS)). The Company offers a range of solutions, including Communications and collaboration, IP Core Routing, IP/optical integration, long term evolution (LTE) Ultra-Broadband, Software-defined networking and Vplus. The Company offers a range of consulting, managed, maintenance and professional services, including Bell Labs Consulting and Build, Operate and Manage (BOM) Solution for Mobility Networks. The main shareholder is Nokia.

EMCORE Corporation Company Profile

EMCORE Corporation is engaged in designing and manufacturing indium phosphide (InP) optical chips, components, subsystems and systems for the broadband and specialty fiber optics market. The Company focuses on linear fiber optic transmission technology. The Company operates through Fiber Optics segment. The Company provides optical components, and also end-to-end solutions for high-speed communications network infrastructures. The Company’s optical technologies are designed for cable television (CATV) and fiber-to-the-premise (FTTP) networks, telecommunications and data centers, satellite communications, aerospace and defense, wireless networks, and broadcast and professional audio/video systems. The Company’s fiber optics products enable information that is modulated on light signals to be transmitted, routed (switched) and received in communication systems and networks.

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