Critical Contrast: Plantronics (PLT) vs. Alcatel Lucent (ALU)

Plantronics (NYSE: PLT) and Alcatel Lucent (NYSE:ALU) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Dividends

Plantronics pays an annual dividend of $0.60 per share and has a dividend yield of 1.1%. Alcatel Lucent does not pay a dividend. Plantronics pays out 285.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider & Institutional Ownership

91.0% of Plantronics shares are held by institutional investors. 3.2% of Plantronics shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Plantronics $881.18 million 2.09 $82.59 million $0.21 265.73
Alcatel Lucent N/A N/A N/A $0.08 43.38

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

Risk and Volatility

Plantronics has a beta of 1.37, indicating that its stock price is 37% more volatile than the S&P 500. Comparatively, Alcatel Lucent has a beta of 2.05, indicating that its stock price is 105% more volatile than the S&P 500.

Profitability

This table compares Plantronics and Alcatel Lucent’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Plantronics 1.03% 22.22% 8.11%
Alcatel Lucent 14.83% 86.14% 10.96%

Analyst Recommendations

This is a summary of recent ratings and price targets for Plantronics and Alcatel Lucent, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Plantronics 0 2 2 0 2.50
Alcatel Lucent 0 0 0 0 N/A

Plantronics currently has a consensus target price of $60.00, suggesting a potential upside of 7.53%. Given Plantronics’ higher probable upside, equities analysts clearly believe Plantronics is more favorable than Alcatel Lucent.

Summary

Plantronics beats Alcatel Lucent on 7 of the 13 factors compared between the two stocks.

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.

Alcatel Lucent Company Profile

Alcatel Lucent SA is a provider of Internet protocol (IP) networking, ultra-broadband access and cloud technology solutions. The Company operates through two segments for the networks business. The Ultra Broadband Networks segment consists of Mobile Networks and Fixed Networks business groups. The IP Networks and Applications segment consists of Internet protocol (IP)/Optical Networks and Applications and Analytics business groups. Its other segment consists of businesses run as separate operations (Alcatel Submarine Networks and Radio Frequency Systems (RFS)). The Company offers a range of solutions, including Communications and collaboration, IP Core Routing, IP/optical integration, long term evolution (LTE) Ultra-Broadband, Software-defined networking and Vplus. The Company offers a range of consulting, managed, maintenance and professional services, including Bell Labs Consulting and Build, Operate and Manage (BOM) Solution for Mobility Networks. The main shareholder is Nokia.

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