Finisar (FNSR) versus Gilat Satellite Networks (GILT) Critical Contrast

Finisar (NASDAQ: FNSR) and Gilat Satellite Networks (NASDAQ:GILT) are both small-cap technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Profitability

This table compares Finisar and Gilat Satellite Networks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Finisar 14.33% 9.51% 5.83%
Gilat Satellite Networks 2.83% 7.58% 4.20%

Analyst Recommendations

This is a summary of recent recommendations for Finisar and Gilat Satellite Networks, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Finisar 1 4 9 1 2.67
Gilat Satellite Networks 0 0 0 0 N/A

Finisar presently has a consensus price target of $26.68, suggesting a potential upside of 51.76%. Given Finisar’s higher probable upside, equities analysts plainly believe Finisar is more favorable than Gilat Satellite Networks.

Volatility & Risk

Finisar has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Gilat Satellite Networks has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500.

Earnings & Valuation

This table compares Finisar and Gilat Satellite Networks’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Finisar $1.45 billion 1.38 $249.34 million $1.75 10.05
Gilat Satellite Networks $279.55 million 1.60 -$5.34 million $0.15 54.33

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

Institutional & Insider Ownership

91.5% of Finisar shares are held by institutional investors. Comparatively, 8.0% of Gilat Satellite Networks shares are held by institutional investors. 1.0% of Finisar shares are held by company insiders. Comparatively, 1.1% of Gilat Satellite Networks 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.

Summary

Finisar beats Gilat Satellite Networks on 11 of the 14 factors compared between the two stocks.

About Finisar

Finisar Corporation (Finisar) is a provider of optical subsystems and components that are used in data communication and telecommunication applications. The Company’s optical subsystems consist of transmitters, receivers, transceivers, transponders and active optical cables, which provide the fundamental optical-electrical or optoelectronic interface for interconnecting the electronic equipment used in these networks, including the switches, routers, and servers used in wireline networks. These products rely on the use of semiconductor lasers and photodetectors in conjunction with integrated circuits and optoelectronic packaging to provide a means for transmitting and receiving digital signals over fiber optic cable at speeds ranging from less than one gigabit per second (Gbps), to more than 100 Gbps, over distances of less than 10 meters to more than 2,000 kilometers, using a range of network protocols and physical configurations.

About Gilat Satellite Networks

Gilat Satellite Networks Ltd. is a provider of satellite-based broadband communications. The Company operates through three segments: Commercial, Mobility and Services divisions. The Company designs and manufactures satellite ground segment and networking communications equipment, which it sells to its customers either as network components (modems, Block Up converters (BUCs), antennas) or as complete network solutions (which include hubs and related terminals and services) or turnkey projects. The equipment that the Company develops includes commercial Very Small Aperture Terminals (VSAT) systems, defense and homeland security satellite communications systems, solid-state power amplifiers (SSPAs), BUCs, low-profile antennas, on-the-Move/on-the-Pause terminals and modems. The Company’s equipment is used by satellite operators, service providers, telecommunications operators, system integrators, government and defense organizations, large corporations and enterprises.

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