Comparing TranSwitch (OTCMKTS:TXCCQ) and POET Technologies (NASDAQ:POET)

TranSwitch (OTCMKTS:TXCCQ) and POET Technologies (NASDAQ:POET) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, profitability, valuation and earnings.

Analyst Recommendations

This is a breakdown of current ratings and target prices for TranSwitch and POET Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TranSwitch	0	0	0	0	0.00
POET Technologies	1	0	0	0	1.00

POET Technologies has a consensus target price of $8.00, indicating a potential upside of 17.47%. Given POET Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe POET Technologies is more favorable than TranSwitch.

Risk and Volatility

TranSwitch has a beta of 22.56, suggesting that its stock price is 2,156% more volatile than the S&P 500. Comparatively, POET Technologies has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500.

Insider and Institutional Ownership

2.0% of POET Technologies shares are owned by institutional investors. 6.3% of TranSwitch shares are owned by insiders. Comparatively, 0.5% of POET Technologies shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares TranSwitch and POET Technologies”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TranSwitch	N/A	N/A	N/A	N/A	N/A
POET Technologies	$40,000.00	22,433.84	-$56.70 million	($0.72)	-9.46

TranSwitch has higher earnings, but lower revenue than POET Technologies.

Profitability

This table compares TranSwitch and POET Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TranSwitch	N/A	N/A	N/A
POET Technologies	-6,625.16%	-103.46%	-52.64%

Summary

TranSwitch beats POET Technologies on 5 of the 9 factors compared between the two stocks.

About TranSwitch

TranSwitch Corporation, together with its subsidiaries, designs, develops, and supplies integrated circuit and intellectual property solutions that provide functionality for voice, data, and video communications equipment for the customer premises and network infrastructure markets. The company provides integrated multi-core network processor system-on-a-chip (SoC) solutions for fixed, 3G and 4G mobile, VoIP, and multimedia applications. It offers converged network infrastructure products, including infrastructure VoIP processors for wire-line and wireless carrier equipment; access VoIP processors; and EoS/EoPDH mappers and framers for carriers to transport data traffic over SONET, SDH, and PDH networks. The company also offers broadband customer premises equipment, such as connectivity solutions comprising HDMI, DisplayPort, MHL, HDP, Ethernet IP cores, and MHDP transceivers for consumer electronics, home network equipment, and industrial and automotive applications; and multi-service SoCs for customer premises equipment that support telephone voice, fax, and routing functionality over broadband access networks. TranSwitch Corporation sells its products to public network system original equipment manufacturers (OEMs), WAN and LAN equipment OEMs, Internet-oriented OEMs, and communications test and performance measurement equipment OEMs; and government, universities, and private laboratories. The company offers its products directly in North America, Taiwan, China, Japan, Korea, and Europe, as well as through a network of distributors in North America, Asia, and Europe. TranSwitch Corporation was founded in 1988 and is headquartered in Shelton, Connecticut. On November 21, 2013, TranSwitch Corporation filed a voluntary petition for liquidation under Chapter 7 in the U.S. Bankruptcy Court for the District of Connecticut.

About POET Technologies

POET Technologies Inc. designs, develops, manufactures, and sells discrete and integrated opto-electronic solutions in Canada, the United States, Singapore, and China. It offers integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques. It also develops photonic integrated components. The company serves the data center, telecommunications, Internet of things and industrial sensing, automotive LIDAR, optical coherence tomography for medical devices, and virtual reality systems markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. was incorporated in 1972 and is headquartered in Toronto, Canada.