Analyzing Alliance Fiber Optic Products (AFOP) and Linear Technology (LLTC)

Alliance Fiber Optic Products (NASDAQ: AFOP) and Linear Technology (NASDAQ:LLTC) are both technology companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Earnings and Valuation

This table compares Alliance Fiber Optic Products and Linear Technology’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alliance Fiber Optic Products N/A N/A N/A $0.49 37.78
Linear Technology N/A N/A N/A $2.04 31.86

Linear Technology is trading at a lower price-to-earnings ratio than Alliance Fiber Optic Products, indicating that it is currently the more affordable of the two stocks.

Dividends

Linear Technology pays an annual dividend of $1.32 per share and has a dividend yield of 2.0%. Alliance Fiber Optic Products does not pay a dividend. Linear Technology pays out 64.7% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current ratings and recommmendations for Alliance Fiber Optic Products and Linear Technology, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alliance Fiber Optic Products 0 0 0 0 N/A
Linear Technology 0 1 0 0 2.00

Linear Technology has a consensus price target of $63.00, suggesting a potential downside of 3.08%. Given Linear Technology’s higher probable upside, analysts clearly believe Linear Technology is more favorable than Alliance Fiber Optic Products.

Risk and Volatility

Alliance Fiber Optic Products has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Linear Technology has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500.

Profitability

This table compares Alliance Fiber Optic Products and Linear Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alliance Fiber Optic Products -4.29% -3.41% -2.68%
Linear Technology 32.99% 26.98% 23.04%

Institutional & Insider Ownership

90.2% of Linear Technology shares are owned by institutional investors. 1.2% of Linear Technology shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Linear Technology beats Alliance Fiber Optic Products on 9 of the 11 factors compared between the two stocks.

About Alliance Fiber Optic Products

Alliance Fiber Optic Products, Inc. (AFOP) designs, manufactures and markets a range of fiber optic components and integrated modules. The Company offers a range of products, including interconnect devices, which are used to connect optical fibers and components; couplers and splitters, which are used to divide and combine optical power, and dense wavelength division multiplexing (DWDM) devices, which are used to separate and combine multiple specific wavelengths. Its connectivity product family provides a line of optical interconnect devices, couplers and splitters, planar lightwave circuits (PLC) and related optical products, as well as integrated modules incorporating these devices. Its optical passive products include wavelength division multiplexing (WDM), coarse wavelength division multiplexer (CWDM) and DWDM components. Its product offerings include connectivity products and optical passive products.

About Linear Technology

Linear Technology Corporation is engaged in designing, manufacturing and marketing a line of analog integrated circuits. The Company produces power management, data conversion, signal conditioning, radio frequency (RF) and interface integrated circuits (ICs) and wireless sensor network products, among others. The Company’s principal product categories include amplifiers, high speed amplifiers, voltage regulators, voltage references, interfaces, data converters, battery stack monitors, silicon oscillators and timer blox, phase locked loop (PLL) synthesizers and clock distribution, SmartMesh embedded wireless sensor network, radio and microwave frequency circuits, Power Over Ethernet (PoE) Controllers, and Other. The Company’s products provide a bridge between analog world and the digital electronics in communications, networking, industrial, transportation, computer, medical, instrumentation, consumer, and military and aerospace systems.

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