Silver Spring Networks (SSNI) versus ModusLink Global Solutions (MLNK) Critical Analysis
Silver Spring Networks (NYSE: SSNI) and ModusLink Global Solutions (NASDAQ:MLNK) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.
Volatility & Risk
Silver Spring Networks has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500. Comparatively, ModusLink Global Solutions has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.
This table compares Silver Spring Networks and ModusLink Global Solutions’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Silver Spring Networks||-7.47%||N/A||-5.55%|
|ModusLink Global Solutions||-8.26%||-47.50%||-11.12%|
This is a summary of recent ratings and price targets for Silver Spring Networks and ModusLink Global Solutions, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Silver Spring Networks||0||10||2||0||2.17|
|ModusLink Global Solutions||0||1||0||0||2.00|
Silver Spring Networks currently has a consensus price target of $14.95, indicating a potential downside of 7.40%. ModusLink Global Solutions has a consensus price target of $8.00, indicating a potential upside of 316.67%. Given ModusLink Global Solutions’ higher probable upside, analysts plainly believe ModusLink Global Solutions is more favorable than Silver Spring Networks.
Insider & Institutional Ownership
79.5% of Silver Spring Networks shares are owned by institutional investors. Comparatively, 56.5% of ModusLink Global Solutions shares are owned by institutional investors. 29.6% of Silver Spring Networks shares are owned by insiders. Comparatively, 1.3% of ModusLink Global Solutions shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Silver Spring Networks and ModusLink Global Solutions’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Silver Spring Networks||$452.27 million||1.91||-$19.70 million||($0.66)||-24.47|
|ModusLink Global Solutions||$438.35 million||0.24||-$11.07 million||($0.68)||-2.82|
ModusLink Global Solutions has higher revenue, but lower earnings than Silver Spring Networks. Silver Spring Networks is trading at a lower price-to-earnings ratio than ModusLink Global Solutions, indicating that it is currently the more affordable of the two stocks.
Silver Spring Networks beats ModusLink Global Solutions on 11 of the 13 factors compared between the two stocks.
About Silver Spring Networks
Silver Spring Networks, Inc. is engaged in creating, building and deploying large-scale networks and solutions enabling the Internet of things (IoT) for critical infrastructure. The Company provides a networking platform and solutions that enable utilities to transform the power grid infrastructure into the smart grid. Its networking platform enables customers to communicate with devices connected to the power grid. Its networking platform comprises hardware, such as access points and relays; its communications modules; its SilverLinkOS network operating software, and its GridScape management and security software. It offers solutions built upon SilverLink Network and Data platforms, including advanced metering, distribution automation, demand-side management, street lights and its wireless Internet protocol version 6 (IPv6) network service for the IoT, Starfish. Through its managed application services, it manages the SilverLink Control Platform and SilverLink Applications.
About ModusLink Global Solutions
ModusLink Global Solutions, Inc. is a provider of supply chain and logistics services through its subsidiaries, ModusLink Corporation and ModusLink PTS, Inc. The Company provides services to companies in the consumer electronics, communications, computing, software, storage and retail industries. The Company operates through four segments: Americas, Asia, Europe and e-business. As of July 31, 2016, the Company operated in over 20 sites across North America, Europe and the Asia Pacific region. The Company’s Supply Chain Business operation’s solutions include material planning and factory supply; value-added warehousing and distribution; aftermarket services, including product returns management and product repair and recovery, and e-business, including e-commerce, contact center, entitlement management and financial management.
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