Harmonic (NASDAQ: HLIT) is one of 66 publicly-traded companies in the “Communications & Networking” industry, but how does it compare to its rivals? We will compare Harmonic to related companies based on the strength of its earnings, risk, valuation, institutional ownership, analyst recommendations, profitability and dividends.

Profitability

This table compares Harmonic and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Harmonic -22.02% -13.06% -6.02%
Harmonic Competitors -3.94% -9.24% -0.97%

Institutional & Insider Ownership

96.0% of Harmonic shares are owned by institutional investors. Comparatively, 62.1% of shares of all “Communications & Networking” companies are owned by institutional investors. 5.5% of Harmonic shares are owned by insiders. Comparatively, 12.4% of shares of all “Communications & Networking” companies are owned by 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 Ratings

This is a summary of current ratings and price targets for Harmonic and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Harmonic 0 2 2 0 2.50
Harmonic Competitors 396 2562 4099 165 2.56

Harmonic presently has a consensus target price of $5.33, indicating a potential upside of 30.08%. As a group, “Communications & Networking” companies have a potential upside of 17.45%. Given Harmonic’s higher probable upside, research analysts clearly believe Harmonic is more favorable than its rivals.

Valuation & Earnings

This table compares Harmonic and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Harmonic $405.91 million -$72.31 million -4.02
Harmonic Competitors $3.30 billion $346.31 million -136.82

Harmonic’s rivals have higher revenue and earnings than Harmonic. Harmonic is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

Harmonic has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, Harmonic’s rivals have a beta of 1.17, suggesting that their average stock price is 17% more volatile than the S&P 500.

Summary

Harmonic rivals beat Harmonic on 10 of the 12 factors compared.

About Harmonic

Harmonic Inc. (Harmonic) designs, manufactures and sells video infrastructure products, and system solutions. The Company has two segments: Video and Cable Edge. Harmonic provides technical support and professional services to its customers around the world. The Video segment sells video processing and production, and playout solutions and services to broadcast and media companies, streaming media companies, cable operators, and satellite and telecommunications (telco), and pay television (TV) service providers. Its Cable Edge business sells cable edge solutions and related services to cable operators around the world. The Video segment offers a range of products and solutions, as well as software-based media processing platforms. The Company’s Narrowcast Services Gateway (NSG) products are integrated edge gateway products that integrate routing, multiplexing, scrambling and modulation into a single package for the delivery of narrowcast services to subscribers over cable networks.

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