Head-To-Head Analysis: ARM (NASDAQ:ARM) & POET Technologies (NASDAQ:POET)

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

Volatility & Risk

ARM has a beta of 3.78, indicating that its share price is 278% more volatile than the S&P 500. Comparatively, POET Technologies has a beta of 0.75, indicating that its share price is 25% less volatile than the S&P 500.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ARM	$4.92 billion	73.64	$904.00 million	$0.84	408.25
POET Technologies	$1.41 million	1,290.18	-$62.96 million	($0.72)	-16.47

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

Insider & Institutional Ownership

7.5% of ARM shares are owned by institutional investors. Comparatively, 2.0% of POET Technologies shares are owned by institutional investors. 0.5% of POET Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
ARM	18.37%	12.43%	9.48%
POET Technologies	-5,786.60%	-27.24%	-20.63%

Analyst Recommendations

This is a summary of current ratings for ARM and POET Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ARM	1	6	20	0	2.70
POET Technologies	1	0	0	0	1.00

ARM currently has a consensus target price of $226.92, indicating a potential downside of 33.83%. POET Technologies has a consensus target price of $8.00, indicating a potential downside of 32.55%. Given POET Technologies’ higher possible upside, analysts clearly believe POET Technologies is more favorable than ARM.

Summary

ARM beats POET Technologies on 11 of the 14 factors compared between the two stocks.

About ARM

Arm Holdings Plc engages in the licensing, marketing, research, and development of microprocessors, systems IP, graphics processing units, physical IP and associated systems IP, software, and tools. It operates through the following geographical segments: United Kingdom, United States, and Other Countries. The company was founded on November 12, 1990 and is headquartered in Cambridge, the United Kingdom.

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.