Acacia Communications (NASDAQ: ACIA) is one of 68 publicly-traded companies in the “Communications & Networking” industry, but how does it weigh in compared to its rivals? We will compare Acacia Communications to related businesses based on the strength of its profitability, risk, valuation, analyst recommendations, earnings, institutional ownership and dividends.

Analyst Ratings

This is a breakdown of current recommendations for Acacia Communications and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Acacia Communications 0 1 9 0 2.90
Acacia Communications Competitors 372 2403 3969 157 2.57

Acacia Communications currently has a consensus target price of $50.50, suggesting a potential upside of 39.85%. As a group, “Communications & Networking” companies have a potential upside of 15.72%. Given Acacia Communications’ stronger consensus rating and higher possible upside, equities analysts clearly believe Acacia Communications is more favorable than its rivals.

Profitability

This table compares Acacia Communications and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Acacia Communications 27.98% 25.29% 21.83%
Acacia Communications Competitors -2.56% -6.44% 0.14%

Insider and Institutional Ownership

84.3% of Acacia Communications shares are held by institutional investors. Comparatively, 64.6% of shares of all “Communications & Networking” companies are held by institutional investors. 37.1% of Acacia Communications shares are held by company insiders. Comparatively, 12.1% of shares of all “Communications & Networking” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

Acacia Communications has a beta of 2.85, indicating that its share price is 185% more volatile than the S&P 500. Comparatively, Acacia Communications’ rivals have a beta of 1.13, indicating that their average share price is 13% more volatile than the S&P 500.

Valuation & Earnings

This table compares Acacia Communications and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Acacia Communications $478.41 million $131.57 million 12.20
Acacia Communications Competitors $3.30 billion $346.33 million -7.18

Acacia Communications’ rivals have higher revenue and earnings than Acacia Communications. Acacia Communications is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Summary

Acacia Communications beats its rivals on 10 of the 13 factors compared.

Acacia Communications Company Profile

Acacia Communications, Inc. provides high-speed coherent interconnect products. The Company’s products include a series of low-power coherent digital signal processor application-specific integrated circuits (DSP ASICs), and silicon photonic integrated circuits (silicon PICs), which it has integrated into families of optical interconnect modules with transmission speeds ranging from 100 to 400 gigabits per second (Gbps) for use in long-haul, metro and inter-data center markets. The Company is also developing optical interconnect modules that will enable transmission speeds of one terabit (1,000 gigabits) per second and above. The Company’s modules perform a majority of the digital signal processing and optical functions in optical interconnects. The Company’s coherent DSP ASICs are manufactured using complementary metal oxide semiconductor (CMOS), and its silicon PICs are manufactured using a CMOS-compatible process.

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