Critical Comparison: Infinera (INFN) and Plantronics (PLT)

Infinera (NASDAQ: INFN) and Plantronics (NYSE:PLT) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, institutional ownership, dividends, earnings, analyst recommendations and valuation.

Institutional and Insider Ownership

90.6% of Infinera shares are owned by institutional investors. Comparatively, 90.9% of Plantronics shares are owned by institutional investors. 2.9% of Infinera shares are owned by company insiders. Comparatively, 3.2% of Plantronics shares are owned by company 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.

Dividends

Plantronics pays an annual dividend of $0.60 per share and has a dividend yield of 1.1%. Infinera does not pay a dividend. Plantronics pays out 24.7% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Infinera and Plantronics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Infinera $870.14 million 1.16 -$23.92 million ($1.07) -6.31
Plantronics $881.18 million 2.07 $82.59 million $2.43 22.66

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

Analyst Recommendations

This is a summary of current ratings and recommmendations for Infinera and Plantronics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Infinera 0 5 9 0 2.64
Plantronics 0 1 3 0 2.75

Infinera currently has a consensus price target of $11.09, suggesting a potential upside of 64.31%. Plantronics has a consensus price target of $58.75, suggesting a potential upside of 6.68%. Given Infinera’s higher possible upside, research analysts clearly believe Infinera is more favorable than Plantronics.

Profitability

This table compares Infinera and Plantronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Infinera -21.59% -16.35% -10.23%
Plantronics 9.41% 20.12% 7.54%

Volatility & Risk

Infinera has a beta of 1.44, meaning that its stock price is 44% more volatile than the S&P 500. Comparatively, Plantronics has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500.

Summary

Plantronics beats Infinera on 12 of the 16 factors compared between the two stocks.

Infinera Company Profile

Infinera Corporation provides optical transport networking equipment, software and services to telecommunications service providers, Internet content providers (ICPs), cable providers, wholesale and enterprise carriers, research and education institutions, enterprise customers and government entities across the globe. The Company’s portfolio consists of the Infinera DTN-X Family, the Infinera DTN platform, the Infinera Cloud Xpress Family, the Infinera XTM Series, the Infinera XTG Series and the Infinera FlexILS platform, addressing long-haul, subsea and metro networks end-to-end. Its technology includes Infinera Intelligent Transport Network Architecture, Infinera Photonic Integrated Circuits, Infinera FlexCoherent Processor, Super-Channels, Sliceable Photonics, Disaggregation, Integrated Digital Switching, Infinera Instant Bandwidth, Infinera Packet-Optical Transport, Multi-layer Switching and Optimization, and Management, Control and Security.

Plantronics Company Profile

Plantronics, Inc. (Plantronics) is engaged in the design, manufacture, and distribution of headsets for business and consumer applications, and other specialty products for the hearing impaired. The Company is a global designer, manufacturer and marketer of communications headsets, telephone headset systems, other communication endpoints and accessories for the business and consumer markets. The Company develops communication products for offices and contact centers, mobile devices, cordless phones, and computers and gaming consoles. Its product categories include Enterprise, which includes corded and cordless communication headsets, audio processors, and telephone systems, and Consumer, which includes Bluetooth and corded products for mobile device applications, personal computer (PC) and gaming headsets, and specialty products marketed for hearing impaired individuals. It offers its products under two brands: Plantronics and Clarity.

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