Financial Contrast: RF Industries (NASDAQ:RFIL) and Murata Manufacturing (OTCMKTS:MRAAY)

Murata Manufacturing (OTCMKTS:MRAAY) and RF Industries (NASDAQ:RFIL) are both technology companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, risk, analyst recommendations, institutional ownership, valuation and earnings.

Institutional and Insider Ownership

0.8% of Murata Manufacturing shares are held by institutional investors. Comparatively, 23.5% of RF Industries shares are held by institutional investors. 20.4% of RF Industries shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Murata Manufacturing and RF Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Murata Manufacturing	0	1	0	1	3.00
RF Industries	0	2	2	0	2.50

RF Industries has a consensus price target of $17.00, suggesting a potential upside of 66.67%. Given RF Industries’ higher probable upside, analysts clearly believe RF Industries is more favorable than Murata Manufacturing.

Risk and Volatility

Murata Manufacturing has a beta of 1.6, suggesting that its stock price is 60% more volatile than the S&P 500. Comparatively, RF Industries has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.

Valuation & Earnings

This table compares Murata Manufacturing and RF Industries”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Murata Manufacturing	$12.16 billion	6.88	$1.54 billion	$0.47	48.68
RF Industries	$82.14 million	1.35	$80,000.00	$0.14	72.86

Murata Manufacturing has higher revenue and earnings than RF Industries. Murata Manufacturing is trading at a lower price-to-earnings ratio than RF Industries, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Murata Manufacturing and RF Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Murata Manufacturing	13.86%	9.84%	8.39%
RF Industries	1.70%	12.79%	6.32%

Dividends

Murata Manufacturing pays an annual dividend of $0.13 per share and has a dividend yield of 0.6%. RF Industries pays an annual dividend of $0.08 per share and has a dividend yield of 0.8%. Murata Manufacturing pays out 27.7% of its earnings in the form of a dividend. RF Industries pays out 57.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Summary

Murata Manufacturing beats RF Industries on 10 of the 17 factors compared between the two stocks.

About Murata Manufacturing

Murata Manufacturing Co., Ltd. designs, manufactures, and sells ceramic-based passive electronic components and solutions in Japan and internationally. The company offers capacitors, inductors, noise suppression products/EMI suppression filters/ESD protection devices, resistors, thermistors, sensors, timing devices, quartz devices, sound components, power products, batteries, micro mechatronics, RFID product, baluns, couplers, filters, phase shifters, RF switches, front-end modules, SAW components, connectors, antennas, connectivity modules, wireless connectivity platforms, ionizers/active oxygen modules, and transformers. It also offers Femtet, a CAE software that solves various engineering challenges; and provides silver oxide battery. In addition, the company provides connectivity, Wifi sensing, IOT, AI, and RFID solutions. Murata Manufacturing Co., Ltd. offers its products for use in communications equipment, mobility, enterprise system, industrial, healthcare, medical, personal electronics applications, and other sectors. The company was founded in 1944 and is headquartered in Nagaokakyo, Japan.

About RF Industries

RF Industries, Ltd., together with its subsidiaries, designs, manufactures, and markets interconnect products and systems in the United States, Canada, Italy, Mexico, and internationally. The company operates through two segments, RF Connector and Cable Assembly, and Custom Cabling Manufacturing and Assembly. The company designs, manufactures, and distributes various coaxial connectors and cable assemblies that are integrated with coaxial connectors; custom copper and fiber cable assemblies, complex hybrid fiber optic and power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive, and medical equipment; energy-efficient cooling systems for wireless base stations and remote equipment shelters; and custom-designed pole-ready 5G small cell integrated enclosures. It also designs and manufactures cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical, and military customers; connectivity solutions to telecommunications and data communications distributors; thermal control systems; and radio frequency and microwave distribution system products, such as dividers, directional couplers, and filters. The company sells its products through warehousing distributors and in-house marketing and sales team. It serves telecommunications carriers and equipment manufacturers, wireless and network infrastructure carriers, and original equipment manufacturers. The company was formerly known as Celltronics, Inc. and changed its name RF Industries, Ltd. in November 1990. RF Industries, Ltd. was incorporated in 1979 and is headquartered in San Diego, California.