Contrasting Genasys (NASDAQ:GNSS) and AudioCodes (NASDAQ:AUDC)

AudioCodes (NASDAQ:AUDC) and Genasys (NASDAQ:GNSS) are both small-cap 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 AudioCodes and Genasys, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AudioCodes	0	1	0	0	2.00
Genasys	1	0	2	0	2.33

Genasys has a consensus price target of $3.87, indicating a potential upside of 166.67%. Given Genasys’ stronger consensus rating and higher probable upside, analysts plainly believe Genasys is more favorable than AudioCodes.

Institutional & Insider Ownership

68.0% of AudioCodes shares are owned by institutional investors. Comparatively, 40.0% of Genasys shares are owned by institutional investors. 48.8% of AudioCodes shares are owned by company insiders. Comparatively, 8.3% of Genasys 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

AudioCodes has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500. Comparatively, Genasys has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500.

Profitability

This table compares AudioCodes and Genasys’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AudioCodes	2.83%	6.79%	3.45%
Genasys	-10.86%	-435.06%	-9.83%

Earnings & Valuation

This table compares AudioCodes and Genasys”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AudioCodes	$245.60 million	1.09	$8.95 million	$0.26	42.65
Genasys	$56.89 million	1.16	-$18.11 million	($0.13)	-11.15

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

Summary

AudioCodes beats Genasys on 10 of the 14 factors compared between the two stocks.

About AudioCodes

AudioCodes Ltd. provides advanced communications software, products, and productivity solutions for the digital workplace worldwide. The company offers solutions, products, and services for unified communications, contact centers, hosted business services, Voice.AI, and service provider businesses. Its products include session border controllers, life cycle management solutions, VoIP network routing solutions, media gateways and servers, multi-service business routers, IP phones solutions, and value-added applications, as well as professional services. The company also offers One Voice Operations Center, a voice network management solution; Device Manager for administering business phones and meeting room solutions; AudioCodes Routing Manager for handling call routing in VoIP networks; and User Management Pack 365 simplifies user lifecycle and identity management across Microsoft Teams and Skype for Business deployments. In addition, it provides AudioCodes Live for Microsoft Teams, a portfolio of managed services for simplifying Teams adoption; appliances for Microsoft Skype/Teams for Business, such as survivable branch appliances, CCE, and CloudBond 365; and a range of value-added voice applications comprising SmartTAP, Voca, VoiceAI Connect, and Meeting Insights. Further, the company offers managed services; and AudioCodes Live Platform is a SaaS solution that enables service providers to offer their business customers a seamless migration to uCaaS solutions, such as Microsoft Teams and Zoom Phone. It primarily markets and sells its products through a direct sales force and sales representatives to original equipment manufacturers, network equipment providers, and systems integrators, enterprises, carriers, and distributors in the telecommunications and networking industries. AudioCodes Ltd. was incorporated in 1992 and is headquartered in Lod, Israel.

About Genasys

Genasys Inc. engages in the design, development, and commercialization of critical communications hardware and software solutions to alert, inform, and protect people principally in North and South America, Europe, the Middle East, Asia, and internationally. The company operates through two segments, Hardware and Software. It provides Genasys Protect ALERT, an interactive, cloud-based SaaS solution that is designed to enable SLED and enterprise customers to send critical information to at-risk individuals or groups when an emergency occurs using emails, voice calls, text messages, panic buttons, desktop alerts, TV, social media, and other; and Genasys Protect EVAC that enables responding agencies to determine and communicate the proper scope of a response or evacuation by replacing guesswork with data-driven intelligence; and Genasys Protect CONNECT, an instant communication platform that enables first responders and public safety personnel to collaborate and share information in a single space with text, videos, images, and audio from any location. The company also offers Genasys Protect ACOUSTICS, a mass notification speaker system with Genasys protect command-and-control software; and long range acoustic devices, such as acoustic hailing devices which are used to project alert tones and audible voice messages. It sells its products directly to governments, militaries, end-users, and commercial companies. The company was formerly known as LRAD Corporation. Genasys Inc. was incorporated in 1992 and is based in San Diego, California.