Financial Analysis: Casa Systems (CASA) vs. Ribbon Communications (RBBN)

Casa Systems (NASDAQ: CASA) and Ribbon Communications (NASDAQ:RBBN) are both small-cap technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Valuation & Earnings

This table compares Casa Systems and Ribbon Communications’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Casa Systems $316.12 million 4.57 $88.66 million N/A N/A
Ribbon Communications $252.59 million 2.70 -$13.93 million ($0.45) -14.78

Casa Systems has higher revenue and earnings than Ribbon Communications.

Insider and Institutional Ownership

0.5% of Casa Systems shares are held by institutional investors. Comparatively, 31.9% of Ribbon Communications shares are held by institutional investors. 64.4% of Casa Systems shares are held by company insiders. Comparatively, 7.7% of Ribbon Communications shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Casa Systems and Ribbon Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Casa Systems N/A N/A N/A
Ribbon Communications -8.82% -1.87% -1.32%

Analyst Ratings

This is a summary of recent ratings and price targets for Casa Systems and Ribbon Communications, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Casa Systems 0 2 5 0 2.71
Ribbon Communications 1 1 4 0 2.50

Casa Systems presently has a consensus target price of $22.17, suggesting a potential upside of 22.88%. Ribbon Communications has a consensus target price of $7.05, suggesting a potential upside of 6.02%. Given Casa Systems’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Casa Systems is more favorable than Ribbon Communications.

Summary

Casa Systems beats Ribbon Communications on 10 of the 11 factors compared between the two stocks.

Casa Systems Company Profile

Casa Systems, Inc. is provides a software-centric infrastructure solutions. In addition, the Company offers solutions for next-generation distributed and virtualized architectures in cable operator, fixed telecom and wireless networks. Its products include axyom software platform, delivery platforms, multi-service applications, capacity expansion products. The Company offers a range of solutions including addition of critical bandwidth capacity, flexibility to add new and expand existing services, ability to upgrade networks remotely, reduced network complexity, ability to densify networks, and common platform capabilities to address the needs of both fixed and wireless networks.

Ribbon Communications Company Profile

Sonus Networks, Inc., formerly Solstice Sapphire Investments, Inc., is a provider of networked solutions for communications service providers and enterprises to help them secure and unify their real-time communications infrastructures. The Company helps communications service providers and enterprises hold the session initiation protocol (SIP) and fourth generation (4G)/long term evolution (LTE)-based solutions, including voice over Internet protocol (VoIP), voice over wireless fidelity (VoWiFi), video and unified communications (UC) by securing and enabling Internet Protocol (IP) networks. Its products include session border controllers (SBCs), diameter signaling controllers (DSCs) and VoWiFi solutions. Sonus Products include Sonus GSX9000 Open Services Switch, Sonus T7000 Intelligent Switching System, Sonus Diameter Signaling Controllers, Sonus Signal Transfer Points, Sonus PSX Policy & Routing Server, Sonus WebRTC Services Solution, and Sonus Network Management Solutions.

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