Comparing Ituran Location and Control (NASDAQ:ITRN) & Harmonic (NASDAQ:HLIT)

Harmonic (NASDAQ:HLIT) and Ituran Location and Control (NASDAQ:ITRN) are both small-cap technology companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.

Analyst Ratings

This is a breakdown of current ratings for Harmonic and Ituran Location and Control, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Harmonic	1	3	3	0	2.29
Ituran Location and Control	0	1	4	0	2.80

Harmonic presently has a consensus price target of $17.50, suggesting a potential upside of 45.59%. Ituran Location and Control has a consensus price target of $60.67, suggesting a potential upside of 19.47%. Given Harmonic’s higher possible upside, equities analysts plainly believe Harmonic is more favorable than Ituran Location and Control.

Risk & Volatility

Harmonic has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500. Comparatively, Ituran Location and Control has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.

Profitability

This table compares Harmonic and Ituran Location and Control’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Harmonic	-8.50%	10.91%	5.98%
Ituran Location and Control	16.28%	29.03%	16.29%

Earnings and Valuation

This table compares Harmonic and Ituran Location and Control”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Harmonic	$570.80 million	2.30	-$43.31 million	($0.42)	-28.62
Ituran Location and Control	$359.02 million	2.81	$57.97 million	$3.24	15.67

Ituran Location and Control has lower revenue, but higher earnings than Harmonic. Harmonic is trading at a lower price-to-earnings ratio than Ituran Location and Control, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

99.4% of Harmonic shares are held by institutional investors. Comparatively, 94.8% of Ituran Location and Control shares are held by institutional investors. 1.7% of Harmonic shares are held by insiders. Comparatively, 0.0% of Ituran Location and Control shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Ituran Location and Control beats Harmonic on 9 of the 14 factors compared between the two stocks.

About Harmonic

Harmonic Inc., together with its subsidiaries, provides broadband solutions worldwide. The company operates through Broadband and Video segments. The Broadband segment sells broadband access solutions and related services, including cOS software-based broadband access solutions to broadband operators; and cOS central cloud services, a subscription service for cOS customers. The Video segment sells video processing, production, and playout solutions and services to cable operators, and satellite and telco Pay-TV service providers, as well as to broadcast and media, including streaming media companies. Its video processing appliance solutions include network management and application software, and hardware products, such as encoders, video servers, high-density stream processing systems, and edge processors. This segment also provides VOS360 SaaS platform that provides both streaming and channel origination and distribution services; and software-as-a-service (SaaS) solutions, which enables the packaging and delivery of streaming services, including live streaming, VOD, catch-up TV, start-over TV, network-DVR and cloud-DVR services through HTTP streaming to various device along with dynamic and personal ad insertion. The company also provides technical support and professional services, such as maintenance and support, consulting, implementation, integration services, program management, technical design and planning, building and site preparation, integration and equipment installation, end-to-end system testing, and training, as well as SaaS-related support and deployment. It sells its products through its direct sales force, as well as through independent resellers and systems integrators. The company was incorporated in 1988 and is headquartered in San Jose, California.

About Ituran Location and Control

Ituran Location and Control Ltd., together with its subsidiaries, provides location based telematics services and machine-to-machine telematics products. It operates through two segments, Telematics Services and Telematics Products. The Telematics services segment offers stolen vehicle recovery and tracking services, which enables to locate, track, and recover stolen vehicles for its subscribers; fleet management services that enable corporate and individual customers to track and manage their vehicles in real time; and locator services that allow customers to protect valuable merchandise and equipment. This segment also delivers on-demand navigation guidance, information, and assistance, including the provision of traffic reports and directions, as well as information on the location of gas stations, car repair shops, post offices, hospitals, and other facilities; and Connected Car, a service platform that includes a back-office application, a telematics device installed in the vehicle, mobile apps for IOS and Android users, and interface using the car infotainment screen, as well as usage based insurance and auto financing services. This segment serves insurance companies and agents, car manufacturers, dealers and importers, cooperative sales channels, and private subscribers. The Telematics Products segment offers Base Site, a radio receiver that includes a processor and a data computation unit to collect and send data to and from transponders, and to control centers; Control Center, a center consisting of software used to collect data from various base sites, conduct location calculations, and transmit location data to various customers and law enforcement agencies; navigation and tracking devices installed in vehicles; and SMART, a portable transmitter installed in vehicles that sends a signal to the base site enabling the location of vehicles, equipment, or an individual. The company was incorporated in 1994 and is headquartered in Azor, Israel.