QLogic (NASDAQ: QLGC) and RadiSys (NASDAQ:RSYS) are both technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.

Institutional and Insider Ownership

49.2% of RadiSys shares are held by institutional investors. 6.1% of RadiSys shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares QLogic and RadiSys’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
QLogic N/A N/A N/A $0.74 21.72
RadiSys $212.39 million 0.14 -$10.25 million ($0.95) -0.82

QLogic has higher revenue, but lower earnings than RadiSys. RadiSys is trading at a lower price-to-earnings ratio than QLogic, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for QLogic and RadiSys, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
QLogic 0 0 0 0 N/A
RadiSys 0 0 5 0 3.00

RadiSys has a consensus price target of $3.60, indicating a potential upside of 361.54%. Given RadiSys’ higher possible upside, analysts clearly believe RadiSys is more favorable than QLogic.

Profitability

This table compares QLogic and RadiSys’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
QLogic 15.71% 9.67% 8.76%
RadiSys -26.07% -47.11% -16.97%

Summary

RadiSys beats QLogic on 5 of the 9 factors compared between the two stocks.

QLogic Company Profile

QLogic Corporation (QLogic), designs and supplies server and storage networking connectivity products that provide and manage computer data communication. The Company’s products facilitate the transfer of data and enable resource sharing between servers, networks and storage. Its products are used in enterprise, managed service provider, consumer Web, and cloud service provider data centers. Its products are based primarily on Fiber Channel and Ethernet technologies and are used in connection with storage networks, data networks and converged networks. Storage networks are used to provide access to storage across enterprise environments. Fibre Channel is a technology for enterprise storage networking. Data networks are used to provide workstation-to-server, server-to-server, and server-to-storage connectivity using Ethernet. Converged networks are designed to address the data center by consolidating and unifying storage and data networks, using high-speed Ethernet.

RadiSys Company Profile

Radisys Corporation (Radisys) is a services acceleration company. The Company’s application aware traffic distribution platforms, real-time media processing products and wireless access technologies enable service providers to virtualize and monetize their networks. The Company’s products and services are organized into two segments: Software-Systems, and Embedded Products and Hardware Services. The Company’s Software-Systems segment consists of three product families: FlowEngine, MediaEngine and CellEngine. Also included in the Software-Systems segment is its Professional Service organization. The Company’s Embedded Products and Hardware Services segment provides customers with hardware based products targeted at the communications and healthcare markets. Products within this segment fall under primary categories, including T-Series Advanced Telecommunications Computing Architecture (ATCA) Platforms, Component Object Model (COM) Express and Rackmount Servers, and Other Products.

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