Harmonic (HLIT) and UTStarcom Holdings Corp (UTSI) Critical Survey
Harmonic (NASDAQ: HLIT) and UTStarcom Holdings Corp (NASDAQ:UTSI) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.
This table compares Harmonic and UTStarcom Holdings Corp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|UTStarcom Holdings Corp||1.24%||1.07%||0.49%|
Institutional and Insider Ownership
97.3% of Harmonic shares are owned by institutional investors. Comparatively, 24.8% of UTStarcom Holdings Corp shares are owned by institutional investors. 4.3% of Harmonic shares are owned by company insiders. Comparatively, 2.7% of UTStarcom Holdings Corp shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Volatility and Risk
Harmonic has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, UTStarcom Holdings Corp has a beta of -0.34, meaning that its share price is 134% less volatile than the S&P 500.
Earnings and Valuation
This table compares Harmonic and UTStarcom Holdings Corp’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Harmonic||$379.77 million||0.72||-$18.46 million||($1.03)||-3.25|
|UTStarcom Holdings Corp||$80.18 million||0.90||$535,000.00||$0.02||101.55|
UTStarcom Holdings Corp has higher revenue, but lower earnings than Harmonic. Harmonic is trading at a lower price-to-earnings ratio than UTStarcom Holdings Corp, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings for Harmonic and UTStarcom Holdings Corp, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|UTStarcom Holdings Corp||0||0||0||0||N/A|
Harmonic presently has a consensus target price of $5.67, suggesting a potential upside of 69.15%. Given Harmonic’s higher possible upside, analysts clearly believe Harmonic is more favorable than UTStarcom Holdings Corp.
Harmonic Inc. (Harmonic) designs, manufactures and sells video infrastructure products, and system solutions. The Company has two segments: Video and Cable Edge. Harmonic provides technical support and professional services to its customers around the world. The Video segment sells video processing and production, and playout solutions and services to broadcast and media companies, streaming media companies, cable operators, and satellite and telecommunications (telco), and pay television (TV) service providers. Its Cable Edge business sells cable edge solutions and related services to cable operators around the world. The Video segment offers a range of products and solutions, as well as software-based media processing platforms. The Company’s Narrowcast Services Gateway (NSG) products are integrated edge gateway products that integrate routing, multiplexing, scrambling and modulation into a single package for the delivery of narrowcast services to subscribers over cable networks.
About UTStarcom Holdings Corp
UTStarcom Holdings Corp. provides broadband products, solution and services. The Company delivers broadband transport and access (both wireless fidelity (Wi-Fi) and fixed line) products and solutions, optimized for mobile backhaul, metro aggregation, broadband access and Wi-Fi data offloading. Its segments include Equipment, which is focused on its equipment sales, including network infrastructure and application products, and Services, which is engaged in providing services and support of its equipment products and also the new operational support segment. The broadband product lines include family of packet transport network (PTN) products based on multi-protocol label switch transport profile (MPLS-TP) and carrier Ethernet (CE) technologies enhanced through in-house software-defined networking (SDN) platform to support the network evolution, and multi services access network (MSAN) platform. Wireless broadband access is represented by end-to-end Carrier Wi-Fi solution.
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