Critical Review: Motorola Solutions (NYSE:MSI) & Vecima Networks (OTCMKTS:VNWTF)

Vecima Networks (OTCMKTS:VNWTF) and Motorola Solutions (NYSE:MSI) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.

Institutional and Insider Ownership

0.3% of Vecima Networks shares are owned by institutional investors. Comparatively, 84.2% of Motorola Solutions shares are owned by institutional investors. 1.3% of Motorola Solutions shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Vecima Networks pays an annual dividend of $0.04 per share and has a dividend yield of 0.5%. Motorola Solutions pays an annual dividend of $4.84 per share and has a dividend yield of 1.0%. Vecima Networks pays out 4.3% of its earnings in the form of a dividend. Motorola Solutions pays out 38.1% 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. Motorola Solutions has increased its dividend for 13 consecutive years. Motorola Solutions is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Vecima Networks and Motorola Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vecima Networks	0	0	1	0	3.00
Motorola Solutions	0	1	10	2	3.08

Motorola Solutions has a consensus target price of $516.67, indicating a potential upside of 9.80%. Given Motorola Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Motorola Solutions is more favorable than Vecima Networks.

Profitability

This table compares Vecima Networks and Motorola Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vecima Networks	N/A	N/A	N/A
Motorola Solutions	17.44%	100.67%	12.89%

Earnings and Valuation

This table compares Vecima Networks and Motorola Solutions”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vecima Networks	N/A	N/A	N/A	$1.04	8.86
Motorola Solutions	$11.87 billion	6.58	$2.15 billion	$12.70	37.05

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

Summary

Motorola Solutions beats Vecima Networks on 14 of the 15 factors compared between the two stocks.

About Vecima Networks

Vecima Networks Inc. engages in the development of integrated hardware and software solutions for broadband access, content delivery, and telematics. The company operates through three segments: Video and Broadband Solutions, Content Delivery and Storage, and Telematics. The Video and Broadband Solutions segment offers platforms that process data from the cable network and deliver high-speed internet connectivity to homes over cable and fiber, as well as adapt video services. Its principal products include Terrace and TerraceQAM, which are designed to meet the needs of the business services verticals, such as multi- dwelling unit, hotels, motels, and resorts; and Entra distributed access architecture platform comprising EntraPHY, EntraMAC, EntraOptical, EntraControl, and EntraVideo that addresses the network migration to a distributed access architecture. The Content Delivery and Storage segment offers solutions and software for service providers and content owners that focus on ingesting, producing, storing, delivering, and streaming video for live linear, video on demand, network digital video recorder, and time-shifted services over the internet under the MediaScale brand. The Telematics segment provides information and analytics for fleet managers to manage their mobile and fixed assets under the Contigo and Nero Global Tracking brands. The company also offers optical access nodes, Terrace QAM, Terrace TC600E, Terrace IQ, Entra FPXT-B, Enra access code, Entra access controller, Entra access switch, Entra Remote PHY Monitor, Entra Video QAM Manager, MediaScale Origin, MediaScale storage, and MediaScale transcode. In addition, it provides engineering and consultation services; lifecycle program management; installation and commission; training and certification; workforce optimization; and operations and customer support services. The company was incorporated in 1988 and is headquartered in Victoria, Canada. Vecima Networks Inc. is a subsidiary of 684739 B.C. Ltd.

About Motorola Solutions

Motorola Solutions, Inc. provides public safety and enterprise security solutions in the United States, the United Kingdom, Canada, and internationally. The company operates in two segments, Products and Systems Integration, and Software and Services. The Products and Systems Integration segment offers a portfolio of infrastructure, devices, accessories, and video security devices and infrastructure, as well as the implementation and integration of systems, devices, software, and applications for government, public safety, and commercial customers who operate private communications networks and video security solutions, as well as manage a mobile workforce. Its land mobile radio communications, and video security and access control devices include two-way portable and vehicle-mounted radios, fixed video cameras, and accessories; communications network core and central processing software, base stations, consoles, and repeaters; and video analytics, network video management hardware and software, and access control solutions. The Software and Services segment provides public safety and enterprise command center, unified communications applications, mobile video equipment, and video software solutions; repair, technical support, and maintenance services; and monitoring, software updates, and cybersecurity services to government, public safety, and commercial communications networks. It serves hospitality; manufacturing; military and defence; public safety; mining; oil and gas; transportation and logistics; utilities industries. The company was formerly known as Motorola, Inc. and changed its name to Motorola Solutions, Inc. in January 2011. Motorola Solutions, Inc. was founded in 1928 and is headquartered in Chicago, Illinois.