Analyzing ADT (NYSE:ADT) & Capstone Cos. (OTCMKTS:CAPC)

Capstone Cos. (OTCMKTS:CAPC) and ADT (NYSE:ADT) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, institutional ownership, risk, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Capstone Cos. and ADT, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Capstone Cos.	0	0	0	0	0.00
ADT	0	4	3	0	2.43

ADT has a consensus price target of $9.34, suggesting a potential upside of 9.69%. Given ADT’s stronger consensus rating and higher probable upside, analysts plainly believe ADT is more favorable than Capstone Cos..

Institutional & Insider Ownership

87.2% of ADT shares are held by institutional investors. 40.0% of Capstone Cos. shares are held by company insiders. Comparatively, 2.7% of ADT shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Capstone Cos. and ADT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Capstone Cos.	N/A	N/A	-23.13%
ADT	12.30%	18.58%	4.35%

Volatility & Risk

Capstone Cos. has a beta of -0.32, meaning that its share price is 132% less volatile than the S&P 500. Comparatively, ADT has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500.

Valuation and Earnings

This table compares Capstone Cos. and ADT”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Capstone Cos.	$140,000.00	17.76	-$960,000.00	($0.01)	-5.01
ADT	$4.90 billion	1.45	$501.05 million	$0.66	12.90

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

Summary

ADT beats Capstone Cos. on 12 of the 14 factors compared between the two stocks.

About Capstone Cos.

Capstone Companies, Inc., through its subsidiaries, operates as a designer, manufacturer, and marketer of consumer products to simplify daily living through technology. The company offers Connected Chef, a purpose-built kitchen appliance tablet with an integrated platform for cooking accessories, such as cutting board, as well as Smart Mirrors. It sells its products through sales agents, as well as directly to home-goods chain retailers. The company was formerly known as CHDT Corporation and changed its name to Capstone Companies, Inc. in June 2012. Capstone Companies, Inc. was incorporated in 1996 and is headquartered in Deerfield Beach, Florida.

About ADT

ADT Inc. provides security, interactive, and smart home solutions to residential and small business customers in the United States. It operates through two segments, Consumer and Small Business, and Solar. The company provides burglar and life safety alarms, smart security cameras, smart home automation systems, and video surveillance systems. It primarily offers security designed to detect intrusion, control access, sense movement, smoke, fire, carbon monoxide, flooding, temperature, and other environmental conditions and hazards; and address personal medical emergencies, such as injuries or unanticipated falls. The company also provides automation and smart home solutions that allow customers to use their smart phones, smart phone application, or touchscreen panels in their homes to arm and disarm their security systems; record and view real-time video; and creates customized and automated schedules for connected devices; programs systems to react to defined events; integrates system with third-party connected devices, such as cameras, lights, thermostats, appliances, and garage doors, as well as offers monitoring and maintenance services. In addition, the company offers energy storage solutions, energy efficiency upgrades, and roofing services. It offers its products under the ADT, ADT Pulse, ADT+, and ADT Commercial brand names. The company was formerly known as Prime Security Services Parent, Inc. and changed its name to ADT Inc. in September 2017. ADT Inc. was founded in 1874 and is headquartered in Boca Raton, Florida.