Anixter International (NYSE: AXE) and FARO Technologies (NASDAQ:FARO) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, dividends, analyst recommendations and valuation.

Profitability

This table compares Anixter International and FARO Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Anixter International 1.91% 13.09% 4.22%
FARO Technologies -0.13% -0.13% -0.10%

Valuation and Earnings

This table compares Anixter International and FARO Technologies’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Anixter International $7.75 billion 0.37 $382.00 million $4.39 19.73
FARO Technologies $335.54 million 1.87 $13.50 million ($0.03) -1,251.25

Anixter International has higher revenue and earnings than FARO Technologies. FARO Technologies is trading at a lower price-to-earnings ratio than Anixter International, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

85.5% of Anixter International shares are held by institutional investors. Comparatively, 94.6% of FARO Technologies shares are held by institutional investors. 14.7% of Anixter International shares are held by company insiders. Comparatively, 2.4% of FARO Technologies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Anixter International and FARO Technologies, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anixter International 0 4 1 0 2.20
FARO Technologies 0 2 4 0 2.67

Anixter International currently has a consensus price target of $86.00, suggesting a potential downside of 0.69%. FARO Technologies has a consensus price target of $39.40, suggesting a potential upside of 4.93%. Given FARO Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe FARO Technologies is more favorable than Anixter International.

Risk & Volatility

Anixter International has a beta of 2.03, meaning that its share price is 103% more volatile than the S&P 500. Comparatively, FARO Technologies has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500.

Summary

Anixter International beats FARO Technologies on 8 of the 13 factors compared between the two stocks.

Anixter International Company Profile

Anixter International Inc. is engaged in the distribution of enterprise cabling and security solutions, electrical and electronic wire and cable products and utility power solutions. The Company operates through three segments: Network & Security Solutions (NSS), Electrical & Electronic Solutions (EES), and Utility Power Solutions (UPS). The NSS segment’s product portfolio includes access control, power, cable management, wireless, professional audio/video, voice and networking switches, and other ancillary products. The EES segment’s product portfolio includes electrical and electronic wire and cable, shipboard cable, support and supply products, low-voltage cable, instrumentation cable, industrial communication and control products, security cable, connectors, industrial Ethernet switches, and voice and data cable. The UPS segment supplies electrical transmission and distribution products, power plant maintenance, repair and operations supplies, and smart-grid products.

FARO Technologies Company Profile

FARO Technologies, Inc. designs, develops, manufactures, markets and supports software driven, three-dimensional (3D) measurement, imaging and realization systems. The Company operates in three segments: Factory Metrology, Construction BIM-CIM and Other. It sells its products through a direct sales force across customers in a range of manufacturing, industrial, architecture, surveying, building construction and law enforcement applications. Its FaroArm, FARO Laser ScanArm, FARO Gage, FARO Laser Tracker, FARO Cobalt Array 3D Imager AMP, and their companion CAM2 software provide for Computer-Aided Design-based inspection and/or factory-level statistical process control and surveying. It operates in international markets throughout the world and maintain sales offices in Australia, Brazil, Canada, China, India, Italy, Japan, Malaysia, Mexico, the Netherlands, Poland, Portugal, Singapore, South Korea, Spain, Switzerland, Thailand, Turkey, the United Kingdom, the United States and Vietnam.

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