Contrasting Meru Networks (MERU) and CalAmp (CAMP)

Meru Networks (NASDAQ: MERU) and CalAmp (NASDAQ:CAMP) are both small-cap wireless telecommunications services – nec companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, analyst recommendations, valuation, institutional ownership and earnings.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Meru Networks and CalAmp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Meru Networks 0 0 0 0 N/A
CalAmp 0 2 6 0 2.75

CalAmp has a consensus target price of $25.86, indicating a potential upside of 10.64%. Given CalAmp’s higher possible upside, analysts plainly believe CalAmp is more favorable than Meru Networks.

Risk and Volatility

Meru Networks has a beta of 1.44, meaning that its stock price is 44% more volatile than the S&P 500. Comparatively, CalAmp has a beta of 1.73, meaning that its stock price is 73% more volatile than the S&P 500.

Profitability

This table compares Meru Networks and CalAmp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Meru Networks -46.15% N/A -86.56%
CalAmp 5.00% 19.20% 7.92%

Earnings & Valuation

This table compares Meru Networks and CalAmp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Meru Networks N/A N/A N/A ($0.87) -1.86
CalAmp $351.10 million 2.37 -$7.90 million $0.47 49.72

Meru Networks has higher earnings, but lower revenue than CalAmp. Meru Networks is trading at a lower price-to-earnings ratio than CalAmp, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

71.7% of CalAmp shares are held by institutional investors. 5.3% of CalAmp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

CalAmp beats Meru Networks on 11 of the 11 factors compared between the two stocks.

About Meru Networks

Meru Networks, Inc. (Meru) develops and markets a virtualized Wireless Local Area Network (WLAN) solution. The Company’s solution is built around its System Director Operating System, which runs on its controllers and access points. The Company offers additional products designed to deliver network management, diagnostics and security. The Company also offers support services related to its products, professional services, and training. Its products and services are sold through value added resellers, and distributors, as well as its sales force. Its System Director Operating System forms the core of its virtualized WLAN solution. It provides a family of controllers that run its System Director Operating System and work in conjunction with its access points. Its Wireless Fidelity (Wi-Fi) certified access points provide network connectivity for wireless devices. Its bring-your-own-device (BYOD) and policy management solutions are designed to automate secure guest access.

About CalAmp

CalAmp Corp. (CalAmp) is a provider of wireless communications solutions for a range of applications to customers globally. The Company operates through two business segments: Wireless DataCom and Satellite. The Company’s Wireless DataCom segment offers solutions for mobile resource management (MRM) applications, the machine-to-machine (M2M) communications space and other markets that require connectivity anytime and anywhere. The Company’s MRM and M2M solutions collect, monitor and report data and intelligence from remote and mobile assets. The Company delivers products, software services and solutions for energy, government, transportation and automotive vertical markets. The Company’s Satellite segment develops, manufactures and sells direct-broadcast satellite (DBS) outdoor customer premise equipment and whole home video networking devices enabling the delivery of digital and high definition satellite television services. Its satellite products are sold primarily to EchoStar.

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