Pixelworks (NASDAQ: PXLW) and Resonant (NASDAQ:RESN) are both small-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, valuation, dividends, profitability, institutional ownership, earnings and analyst recommendations.

Profitability

This table compares Pixelworks and Resonant’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pixelworks -0.36% 20.65% 11.97%
Resonant -2,772.35% -150.45% -125.40%

Insider & Institutional Ownership

37.6% of Pixelworks shares are held by institutional investors. Comparatively, 5.2% of Resonant shares are held by institutional investors. 4.5% of Pixelworks shares are held by company insiders. Comparatively, 22.3% of Resonant shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

Pixelworks has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Resonant has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Pixelworks and Resonant, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pixelworks 0 0 3 0 3.00
Resonant 0 0 4 0 3.00

Pixelworks currently has a consensus price target of $7.00, suggesting a potential upside of 5.11%. Resonant has a consensus price target of $9.50, suggesting a potential upside of 36.30%. Given Resonant’s higher possible upside, analysts clearly believe Resonant is more favorable than Pixelworks.

Earnings and Valuation

This table compares Pixelworks and Resonant’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pixelworks $53.39 million 4.27 -$11.10 million N/A N/A
Resonant $300,000.00 389.86 -$15.24 million ($1.37) -5.09

Pixelworks has higher revenue and earnings than Resonant.

Summary

Pixelworks beats Resonant on 7 of the 12 factors compared between the two stocks.

About Pixelworks

Pixelworks, Inc. designs, develops and markets video and pixel processing semiconductors, intellectual property cores, software and custom application specific integrated circuit (ASIC) solutions for digital video applications. The Company is engaged in the design and development of integrated circuits (ICs) for use in electronic display devices. It provides its customers with software development tools and with software that provides basic functionality for its ICs and enables connectivity of its customers’ products. Its primary target markets include digital projection systems, Ultrabook devices, tablets and smartphones. Its video display processing technologies include Halo Free Motion Estimation and Motion Compensation (MEMC), Advanced Scaling, Mobile Video Display Processing, and Vuemagic and Networked Displays. Its primary video display processor product categories include ImageProcessor ICs, Video Co-Processor ICs and Networked Display ICs.

About Resonant

Resonant Inc. is a late-stage development company. The Company creates filter designs for radio frequency (RF) front-ends for the mobile device industry. The RF front-end is the circuitry in a mobile device for analog signal processing and is located between the device’s antenna and its digital baseband. The Company uses a technology called Infinite Synthesized Networks (ISN) to configure and connect resonators, the building blocks of RF filters. The Company uses ISN to develop new classes of filter designs. The Company is also developing a series of single-band surface acoustic wave (SAW) filter designs for frequency bands. The Company is developing multiplexer filter designs for over two bands to address the carrier aggregation (CA) requirements of its customers. In addition, the Company is also developing reconfigurable filter designs to replace multiple filters for multiple bands. The Company is also involved in the development of a filter reconfigurable between three bands.

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