Immersion Corporation (NASDAQ: IMMR) and Stratasys (NASDAQ:SSYS) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Profitability

This table compares Immersion Corporation and Stratasys’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Immersion Corporation -113.47% -43.56% -22.98%
Stratasys -8.33% 0.29% 0.24%

Valuation and Earnings

This table compares Immersion Corporation and Stratasys’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Immersion Corporation $51.85 million 4.11 -$17.43 million ($2.03) -3.59
Stratasys $665.63 million 1.80 $30.05 million ($1.07) -21.22

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

Risk & Volatility

Immersion Corporation has a beta of 1.41, suggesting that its share price is 41% more volatile than the S&P 500. Comparatively, Stratasys has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.

Insider and Institutional Ownership

75.3% of Immersion Corporation shares are held by institutional investors. Comparatively, 67.0% of Stratasys shares are held by institutional investors. 7.2% of Immersion Corporation shares are held by insiders. Comparatively, 4.3% of Stratasys shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Immersion Corporation and Stratasys, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Immersion Corporation 0 1 4 0 2.80
Stratasys 5 9 4 0 1.94

Immersion Corporation currently has a consensus price target of $10.75, suggesting a potential upside of 47.46%. Stratasys has a consensus price target of $24.21, suggesting a potential upside of 6.62%. Given Immersion Corporation’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Immersion Corporation is more favorable than Stratasys.

Immersion Corporation Company Profile

Immersion Corporation is a licensing company focused on the creation, design, development and licensing of haptic technologies that allow people to use their sense of touch when operating digital devices. The Company develops, licenses and supports a range of software and intellectual property (IP). It is focused on the markets, including mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical, and commercial. It provides advanced tactile software, related tools and technical assistance to certain customers, and offers licenses to its patented IP to other customers. Its licenses enable customers to deploy haptically-enabled devices, content and other offerings, which they sell under own brand names. It holds patents, covering digital technologies and including ways in which touch-related technology can be incorporated into and between hardware products and components, systems software, application software, and digital content.

Stratasys Company Profile

Stratasys, Inc. is a manufacturer of three-dimensional (3D) printers and rapid prototyping (RP) systems for the office-based RP and direct digital manufacturing (DDM) markets. The Company develops, manufactures and sells a product line of 3D printers and DDM systems (and related consumable materials) that create physical models from computer-aided design (CAD) designs. It also offer rapid prototyping and production part manufacturing services through its centers located in North America, Europe and Australia. In January 2009, the Company introduced the uPrint Personal 3D Printer. In January 2009, it began offering a thermoplastic for direct digital manufacturing and rapid prototyping called ULTEM 9085.

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