Harmonic (NASDAQ:HLIT) vs. Redline Communications Group (OTCMKTS:RDLCF) Critical Review

Redline Communications Group (OTCMKTS:RDLCF) and Harmonic (NASDAQ:HLIT) are both technology companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, risk, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Redline Communications Group and Harmonic, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Redline Communications Group	0	0	0	0	0.00
Harmonic	1	3	2	0	2.17

Harmonic has a consensus price target of $16.60, suggesting a potential upside of 40.20%. Given Harmonic’s stronger consensus rating and higher probable upside, analysts plainly believe Harmonic is more favorable than Redline Communications Group.

Earnings and Valuation

This table compares Redline Communications Group and Harmonic”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Redline Communications Group	N/A	N/A	N/A	N/A	N/A
Harmonic	$570.80 million	2.25	-$43.31 million	($0.37)	-32.00

Redline Communications Group has higher earnings, but lower revenue than Harmonic.

Insider & Institutional Ownership

99.4% of Harmonic shares are held by institutional investors. 1.7% of Harmonic shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Redline Communications Group and Harmonic’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Redline Communications Group	N/A	N/A	N/A
Harmonic	-7.50%	7.84%	4.30%

Summary

Harmonic beats Redline Communications Group on 8 of the 9 factors compared between the two stocks.

About Redline Communications Group

Redline Communications Group Inc., together with its subsidiaries, develops broadband fixed wireless base stations, subscriber stations, and network management systems for point-to-point and point-to-multipoint applications for commercial end-users. It operates through Hardware and Software, Professional Services and 3rd Party Equipment, and Maintenance and Support segments. The company offers Ellipse, a series of base stations; Edge and Elte wireless terminals; Enterprise, a wireless customer premise equipment; RAS-Elite, a portable auto-acquire outdoor wireless solution; RAS-Extend, a mechanical auto tracking system; RDL-3000 connect series of remote terminals; PoE, an industrial grade power injector; and FlexCore, an EPC software. It also provides FlexTALK, a push-to-talk solution; and ClearView NMS, a network management software, as well as antennas, cables, mounting kits, POE power injectors, and surge protectors. In addition, the company offers RF planning and site survey, 4G and 5G mobile network design and optimization, deployment and resident engineering, wireless network performance audit, and program and project management services. It serves oil and gas, mining, utilities, transportation, government, military, and telecom service provider markets through regional distributors, channel partners, and systems integrators. The company has operations in the Americas, the Middle East, Europe, Africa, and the Asia Pacific. Redline Communications Group Inc. was founded in 1999 and is headquartered in Markham, Canada.

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.