AudioCodes (NASDAQ: AUDC) and CommScope Holding (NASDAQ:COMM) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, valuation, institutional ownership and dividends.

Profitability

This table compares AudioCodes and CommScope Holding’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AudioCodes 11.95% 7.78% 4.47%
CommScope Holding 4.96% 33.38% 6.65%

Institutional and Insider Ownership

22.0% of AudioCodes shares are owned by institutional investors. 48.8% of AudioCodes shares are owned by company insiders. Comparatively, 3.3% of CommScope Holding shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

AudioCodes has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500. Comparatively, CommScope Holding has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for AudioCodes and CommScope Holding, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AudioCodes 0 1 2 0 2.67
CommScope Holding 0 5 8 0 2.62

AudioCodes presently has a consensus price target of $7.50, indicating a potential upside of 4.17%. CommScope Holding has a consensus price target of $41.20, indicating a potential upside of 23.35%. Given CommScope Holding’s higher possible upside, analysts clearly believe CommScope Holding is more favorable than AudioCodes.

Valuation and Earnings

This table compares AudioCodes and CommScope Holding’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
AudioCodes $151.06 million 1.51 $10.30 million $0.54 13.33
CommScope Holding $4.78 billion 1.35 $1.08 billion $1.21 27.60

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

Summary

CommScope Holding beats AudioCodes on 8 of the 14 factors compared between the two stocks.

AudioCodes Company Profile

AudioCodes Ltd. designs, develops and sells Voice over-Internet Protocol (VoIP) and converged VoIP, and data networking solutions, products and applications that facilitate Unified Communications (UC) and Contact Center (CC) services. The Company categorizes its products and services into two main business lines: network and technology. Network products consist of customer premises equipment (CPE), gateways for the enterprise and service provider (or carrier) markets and of carrier-grade-oriented low- and mid-density media gateways for service providers and Enterprise Session Border Controls (ESBCs). Complementing its media gateways and session border gateways as network products are its multi-service business routers (MSBR), Internet Protocol (IP) phones, media servers, mobile VoIP solutions and value added application products. Technology products consist of its chips and boards business products. Its products are deployed in enterprise, service provider cloud networks.

CommScope Holding Company Profile

CommScope Holding Company, Inc. (CommScope) is a provider of infrastructure solutions for the core, access and edge layers of communications networks. The Company operates through two segments: CommScope Connectivity Solutions (CCS) and CommScope Mobility Solutions (CMS). Its portfolio includes wireless and fiber optic solutions. The Company’s solutions are found in the venues and outdoor spaces, including in data centers and buildings of all shapes, sizes and complexities; at wireless cell sites; in telecom central offices and cable head ends; in fiber-to-the-X (FTTX) deployments, and in airports, trains and tunnels. As of December 31, 2016, it served customers in over 100 countries through a network of more than 30 manufacturing and distribution facilities located around the globe. Its customers include global telecommunication operators and enterprise customers, including Fortune 500 enterprises and multi-system operators (MSOs).

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