Contrasting SCI Engineered Materials (OTCMKTS:SCIA) & POET Technologies (NASDAQ:POET)

POET Technologies (NASDAQ:POET) and SCI Engineered Materials (OTCMKTS:SCIA) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, earnings, dividends and risk.

Analyst Recommendations

This is a summary of current ratings and price targets for POET Technologies and SCI Engineered Materials, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
POET Technologies	1	0	2	1	2.75
SCI Engineered Materials	0	0	0	0	0.00

POET Technologies currently has a consensus price target of $6.25, indicating a potential upside of 42.05%. Given POET Technologies’ stronger consensus rating and higher probable upside, research analysts plainly believe POET Technologies is more favorable than SCI Engineered Materials.

Institutional & Insider Ownership

2.0% of POET Technologies shares are owned by institutional investors. Comparatively, 27.6% of SCI Engineered Materials shares are owned by institutional investors. 0.5% of POET Technologies shares are owned by company insiders. Comparatively, 19.7% of SCI Engineered Materials shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

POET Technologies has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500. Comparatively, SCI Engineered Materials has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500.

Profitability

This table compares POET Technologies and SCI Engineered Materials’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
POET Technologies	-11,497.01%	-141.43%	-68.54%
SCI Engineered Materials	9.13%	11.23%	9.05%

Valuation and Earnings

This table compares POET Technologies and SCI Engineered Materials”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
POET Technologies	$467,946.00	853.05	-$56.70 million	($0.81)	-5.43
SCI Engineered Materials	$22.87 million	0.94	$1.86 million	$0.35	13.46

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

Summary

SCI Engineered Materials beats POET Technologies on 10 of the 15 factors compared between the two stocks.

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.

About SCI Engineered Materials

SCI Engineered Materials, Inc. engages in the manufacture and supply of materials for physical vapor deposition thin film applications in the United States. It offers ceramic targets, metal sputtering targets, and backing plates for use in semiconductors, thin film solar, flat panel displays, defense, aerospace, and photonics industries. The company’s materials are used to produce nano layers of metals and oxides for advanced material systems; and in applying decorative coatings for end uses, such as sink faucets to produce various electronic, photonic, and semiconductor products. It serves domestic and multi-national corporations, universities, and research institutions. The company was formerly known as Superconductive Components, Inc. and changed its name to SCI Engineered Materials, Inc. in 2007. SCI Engineered Materials, Inc. was incorporated in 1987 and is headquartered in Columbus, Ohio.