Comtech Telecommunications (NASDAQ:CMTL – Get Free Report) and Franklin Wireless (NASDAQ:FKWL – Get Free Report) are both small-cap technology companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.
Profitability
This table compares Comtech Telecommunications and Franklin Wireless’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Comtech Telecommunications | -5.52% | 9.77% | 1.05% |
| Franklin Wireless | -2.07% | -2.98% | -2.16% |
Institutional and Insider Ownership
18.5% of Franklin Wireless shares are owned by institutional investors. 2.2% of Comtech Telecommunications shares are owned by insiders. Comparatively, 28.4% of Franklin Wireless shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Risk & Volatility
Analyst Ratings
This is a summary of recent ratings and recommmendations for Comtech Telecommunications and Franklin Wireless, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Comtech Telecommunications | 1 | 1 | 1 | 0 | 2.00 |
| Franklin Wireless | 1 | 0 | 1 | 0 | 2.00 |
Comtech Telecommunications presently has a consensus price target of $2.50, indicating a potential upside of 79.86%. Franklin Wireless has a consensus price target of $6.00, indicating a potential upside of 147.93%. Given Franklin Wireless’ higher possible upside, analysts clearly believe Franklin Wireless is more favorable than Comtech Telecommunications.
Earnings & Valuation
This table compares Comtech Telecommunications and Franklin Wireless”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Comtech Telecommunications | $499.53 million | 0.08 | -$155.30 million | ($2.21) | -0.63 |
| Franklin Wireless | $46.09 million | 0.62 | -$240,000.00 | ($0.06) | -40.33 |
Franklin Wireless has lower revenue, but higher earnings than Comtech Telecommunications. Franklin Wireless is trading at a lower price-to-earnings ratio than Comtech Telecommunications, indicating that it is currently the more affordable of the two stocks.
Summary
Franklin Wireless beats Comtech Telecommunications on 7 of the 12 factors compared between the two stocks.
About Comtech Telecommunications
Comtech Telecommunications Corp., together with its subsidiaries, engages in the provision of next-gen telecommunication solutions in the United States and internationally. The company’s Satellite and Space Communications segment offers satellite ground station technologies, services and system integration that facilitates the transmission of voice, video, and data over GEO, MEO and LEO satellite constellations, including solid-state and traveling wave tube power amplifiers, modems, VSAT platforms, and frequency converters; and satellite communications and tracking antenna systems, including high precision full motion fixed and mobile X/Y tracking antennas, RF feeds, reflectors, and radomes. This segment also provides over-the-horizon microwave troposcatter equipment that can transmit digitized voice, video, and data over distances up to 200 miles using the troposphere and diffraction, including the Comtech; and solid-state, RF microwave high-power amplifiers and control components designed for radar, electronic warfare, data link, medical and aviation applications, as well as engages in the procurement and supply chain management of electrical, electronic, and electromechanical parts for satellite, launch vehicle, and manned space applications. Its Terrestrial and Wireless Networks segment offers next generation 911 solutions, which includes emergency call routing, location validation, policy-based routing rules, logging, and security functionality; emergency services IP network transport infrastructure for emergency services communications and support; call handling applications for public safety answering points; wireless emergency alerts solutions for network operators; and software and equipment for location-based and text messaging services for various applications including for public safety, commercial, and government services. The company was founded in 1967 and is headquartered in Melville, New York.
About Franklin Wireless
Franklin Wireless Corp. provides integrated wireless solutions. The company's products include 5G/4G wireless broadband products, such as wi-fi mobile hotspot, fixed wireless routers, and enterprise gateway CPE; and IoT tracking and connected devices, including smart IoT tracking device, connected car, and home phone connect. It also offers IOT server platform and application, which comprises Pintrac, a cloud based telecom grade server platform; Pintrac Mobile Device Management, an LTE hotspot; Pintrac Pet, a pet tracking application; Pintrac Auto that tracks, locates, and manages vehicles for consumers and businesses; and JEXtream, a cloud based telecom grade server platform for 5G devices and routers that enables enhanced remote management of device functionality. The company directly markets and sells its products to wireless operators, as well as indirectly through strategic partners and distributors located primarily in the North America, the Caribbean and South America, and Asia. Franklin Wireless Corp. was founded in 1981 and is headquartered in San Diego, California.
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