Synchronoss Technologies (NASDAQ: SNCR) and GTT Communications (NYSE:GTT) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, profitability, analyst recommendations, earnings and valuation.

Analyst Ratings

This is a summary of recent ratings for Synchronoss Technologies and GTT Communications, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Synchronoss Technologies 1 5 1 0 2.00
GTT Communications 0 0 6 0 3.00

Synchronoss Technologies currently has a consensus price target of $21.20, indicating a potential upside of 26.27%. GTT Communications has a consensus price target of $35.33, indicating a potential upside of 11.81%. Given Synchronoss Technologies’ higher possible upside, research analysts plainly believe Synchronoss Technologies is more favorable than GTT Communications.

Valuation and Earnings

This table compares Synchronoss Technologies and GTT Communications’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Synchronoss Technologies $476.75 million 1.55 $54.33 million $0.44 38.16
GTT Communications $636.92 million 2.05 $150.79 million ($0.28) -112.86

GTT Communications has higher revenue and earnings than Synchronoss Technologies. GTT Communications is trading at a lower price-to-earnings ratio than Synchronoss Technologies, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Synchronoss Technologies has a beta of 1.69, suggesting that its stock price is 69% more volatile than the S&P 500. Comparatively, GTT Communications has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500.

Institutional & Insider Ownership

74.3% of Synchronoss Technologies shares are owned by institutional investors. Comparatively, 59.8% of GTT Communications shares are owned by institutional investors. 10.5% of Synchronoss Technologies shares are owned by insiders. Comparatively, 25.7% of GTT Communications shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Synchronoss Technologies and GTT Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Synchronoss Technologies 3.38% 11.20% 6.21%
GTT Communications -1.88% 4.17% 0.61%

Synchronoss Technologies Company Profile

Synchronoss Technologies, Inc. is a global software and services company, which provides technologies and services for the mobile transformation of business. The Company’s portfolio in the Consumer and Enterprise markets contains offerings, such as personal cloud, secure-mobility, identity management and scalable messaging platforms, products and solutions. Its products and platforms are designed to enable multiple converged communication services to be managed across a range of distribution channels, including e-commerce, m-commerce, telesales, customer stores, indirect and other retail outlets. The Company operates in and markets their solutions and services directly through their sales organizations in North America, Europe, the Middle East and Africa (EMEA), Latin America and the Asia-Pacific region. It delivers technologies for mobile transformation to service provider and enterprise customers in regulated verticals and use cases.

GTT Communications Company Profile

GTT Communications, Inc. provides cloud networking services to a range of clients. The Company offers a portfolio of global communications services, wide area network (WAN) services; Internet services; managed network and security services, and voice and unified communication services. It provides Layer 2 (Ethernet) and Layer 3 (multiprotocol label switching (MPLS)) WAN solutions for multinational clients. It offers customers with high-bandwidth global Internet connectivity and Internet protocol (IP) transit with availability and packet delivery. The Company offers managed network services, including managed equipment, managed security services and managed remote access. Its Session Initiation Protocol (SIP) Trunking service is an enterprise-built unified communications offering that integrates voice, video and chat onto a single IP connection. As of December 31, 2016, it had provided services to multinational enterprises, carriers and government customers in over 100 countries.

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