SMC (OTCMKTS:SMCAY) and Lightwave Logic (NASDAQ:LWLG) Critical Review

Lightwave Logic (NASDAQ:LWLG) and SMC (OTCMKTS:SMCAY) are both technology companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.

Earnings & Valuation

This table compares Lightwave Logic and SMC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lightwave Logic	$250,251.00	3,271.22	-$20.31 million	($0.16)	-33.19
SMC	$5.60 billion	5.07	$1.10 billion	$1.03	21.55

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

Risk and Volatility

Lightwave Logic has a beta of 2.41, suggesting that its stock price is 141% more volatile than the S&P 500. Comparatively, SMC has a beta of 1.09, suggesting that its stock price is 9% more volatile than the S&P 500.

Insider & Institutional Ownership

27.0% of Lightwave Logic shares are held by institutional investors. Comparatively, 1.0% of SMC shares are held by institutional investors. 2.2% of Lightwave Logic shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Lightwave Logic and SMC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lightwave Logic	-9,143.60%	-30.34%	-28.76%
SMC	21.94%	9.40%	8.53%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Lightwave Logic and SMC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lightwave Logic	1	0	1	0	2.00
SMC	0	1	1	1	3.00

Lightwave Logic presently has a consensus target price of $10.00, indicating a potential upside of 88.32%. Given Lightwave Logic’s higher probable upside, equities analysts clearly believe Lightwave Logic is more favorable than SMC.

Summary

SMC beats Lightwave Logic on 9 of the 14 factors compared between the two stocks.

About Lightwave Logic

Lightwave Logic, Inc. focuses on the development of photonic devices and electro-optical polymer materials systems for fiber-optic data communications, telecommunications, and optical computing markets in the United States. The company is involved in the designing and synthesizing of organic chromophores for use in its electro-optic polymer systems and photonic device designs. It also offers electro-optic modulators, which converts data from electric signals to optical signals for transmission over fiber-optic cables; and polymer photonic integrated circuits, a photonic device, which integrates various photonic functions on a single chip. In addition, the company provides the ridge waveguide modulator, a modulator that fabricates the waveguide within a layer of its electro-optic polymer system. It focuses on selling its products to electro-optic device manufacturers, contract manufacturers, original equipment manufacturers, foundries, packaging and assembly manufacturers, etc.; and semiconductor companies, optical network companies, Web 2.0/3.0 media companies, computing companies, telecommunications companies, aerospace companies, automotive companies, and government agencies and defense entities. The company was formerly known as Third-order Nanotechnologies, Inc. and changed its name to Lightwave Logic, Inc. in March 2008. Lightwave Logic, Inc. was founded in 1991 and is headquartered in Englewood, Colorado.

About SMC

SMC Corporation manufactures, processes, and sells automatic control equipment, sintered filters, and various types of filtration equipment worldwide. The company offers air management system, directional control valves, air cylinders, rotatory actuators/air grippers, electric actuators/cylinders, fitting and tubing, and modular F.R.L./pressure control equipment, as well as vacuum, air preparation, and lubrication equipment. It also provides flow control equipment, speed controllers, silencers/exhaust/blow guns/pressure gauges, switches/sensors/controllers, static neutralization equipment, and industrial device communication equipment/wireless system. In addition, the company offers process valves, chemical liquid valves/fittings and needle valves/tubing, process pumps, temperature control equipment, and process gas equipment, as well as high vacuum equipment, industrial filters/sintered metal elements, and pneumatic instrumentation and hydraulic equipment. The company was formerly known as Shoketsu Kinzoku Kogyo Co., Ltd. and changed its name to SMC Corporation in April 1986. SMC Corporation was incorporated in 1959 and is headquartered in Tokyo, Japan.