Cisco Systems (NASDAQ:CSCO) versus Aviat Networks (NASDAQ:AVNW) Critical Review

Cisco Systems (NASDAQ:CSCO) and Aviat Networks (NASDAQ:AVNW) are both technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, risk and institutional ownership.

Profitability

This table compares Cisco Systems and Aviat Networks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cisco Systems	20.95%	30.16%	11.69%
Aviat Networks	0.58%	5.85%	2.49%

Valuation & Earnings

This table compares Cisco Systems and Aviat Networks”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cisco Systems	$63.33 billion	6.85	$13.27 billion	$3.34	32.95
Aviat Networks	$439.68 million	0.58	$2.54 million	$0.19	104.11

Cisco Systems has higher revenue and earnings than Aviat Networks. Cisco Systems is trading at a lower price-to-earnings ratio than Aviat Networks, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and target prices for Cisco Systems and Aviat Networks, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cisco Systems	0	7	16	2	2.80
Aviat Networks	0	2	9	0	2.82

Cisco Systems presently has a consensus price target of $129.68, suggesting a potential upside of 17.83%. Aviat Networks has a consensus price target of $32.71, suggesting a potential upside of 65.39%. Given Aviat Networks’ stronger consensus rating and higher possible upside, analysts plainly believe Aviat Networks is more favorable than Cisco Systems.

Volatility & Risk

Cisco Systems has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.Comparatively, Aviat Networks has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500.

Institutional and Insider Ownership

73.3% of Cisco Systems shares are owned by institutional investors. Comparatively, 78.6% of Aviat Networks shares are owned by institutional investors. 0.0% of Cisco Systems shares are owned by insiders. Comparatively, 5.3% of Aviat Networks shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Cisco Systems beats Aviat Networks on 10 of the 15 factors compared between the two stocks.

About Cisco Systems

Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.

About Aviat Networks

Aviat Networks, Inc. provides microwave networking and wireless access networking solutions in North America, Africa, the Middle East, Europe, Latin America, and the Asia Pacific. The company offers outdoor, indoor, and split-mount radios; microwave routers, switches, and trunking; and private LTE, virtual fiber, and element management products; and hosted software products, such as aviat design, frequency assurance software, and health assurance software. It also provides project services, which includes design and engineering, site and path surveys, assembly and integrations, project management, and install and commission; and managed services, such as network and interface monitoring, network health, onsite maintenance, and remote upgrades. In addition, the company offers support services, including extended warranty, warranty plus, provision support, and license key management, as well as instructor and virtual instructor led training, e-learning and certification services. It serves communications service providers and private network operators, including federal, state and local government agencies, transportation agencies, energy and utility companies, public safety agencies, and broadcast network operators. The company markets its products through a direct sales, service, and support organization; indirect sales channels comprising dealers, resellers, and sales representatives; and through online. Aviat Networks, Inc. company was incorporated in 2006 and is headquartered in Austin, Texas.