Comparing Knowles (NYSE:KN) & ePlus (NASDAQ:PLUS)

Knowles (NYSE:KN) and ePlus (NASDAQ:PLUS) are both mid-cap technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, valuation, institutional ownership, dividends and profitability.

Risk and Volatility

Knowles has a beta of 1.59, indicating that its stock price is 59% more volatile than the S&P 500. Comparatively, ePlus has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Knowles and ePlus, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Knowles	0	3	2	0	2.40
ePlus	0	2	0	0	2.00

Knowles presently has a consensus price target of $41.00, suggesting a potential upside of 27.54%. Given Knowles’ stronger consensus rating and higher possible upside, equities analysts plainly believe Knowles is more favorable than ePlus.

Earnings and Valuation

This table compares Knowles and ePlus”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Knowles	$666.10 million	4.12	$44.20 million	$0.82	39.20
ePlus	$2.45 billion	1.02	$132.64 million	$4.57	20.87

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

Insider & Institutional Ownership

96.3% of Knowles shares are held by institutional investors. Comparatively, 93.8% of ePlus shares are held by institutional investors. 2.2% of Knowles shares are held by insiders. Comparatively, 2.2% of ePlus shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Knowles and ePlus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Knowles	10.76%	11.88%	8.78%
ePlus	4.91%	11.51%	6.73%

Summary

Knowles beats ePlus on 11 of the 14 factors compared between the two stocks.

About Knowles

Knowles Corporation offers capacitors, radio frequency (RF) filtering products, balanced armature speakers, micro-acoustic microphones, and audio solutions in Asia, the United States, Europe, other Americas, and internationally. It operates through three segments: Precision Devices (PD); Medtech & Specialty Audio (MSA); and Consumer MEMS Microphones (CMM). The PD segment designs and delivers film, electrolytic, and mica capacitor products for use in power supplies and medical implants; electromagnetic interference filters; and RF filtering solutions for use in satellite communications and radar systems for defense applications. The MSA segment designs and manufactures balanced armature speakers and microphones for the hearing health, audio, and True Wireless Stereo (TWS) markets. The CMM segment designs and manufactures micro-electro-mechanical systems (MEMS) microphones and audio solutions used in applications that serve the ear, mobile, TWS, Internet of Things, computing, and smartphones markets. The company serves the defense, medtech, electric vehicle, industrial, communications, and consumer electronics markets through original equipment manufacturers, their contract manufacturers, suppliers, sales representatives, and distributors. Knowles Corporation was founded in 1946 and is headquartered in Itasca, Illinois.

About ePlus

ePlus inc., together with its subsidiaries, provides information technology (IT) solutions that enable organizations to optimize their IT environment and supply chain processes in the United States and internationally. It operates through two segments, Technology and Financing. The Technology segment offers hardware, perpetual and subscription software, maintenance, software assurance, and internally provided and outsourced services; managed services or infrastructure and cloud; and enhanced maintenance support, service desk, storage-as-a-service, cloud hosted and managed, and managed security services; and professional, staff augmentation, cloud consulting, consulting, and security services. The Financing segment engages in financing arrangements, such as sales-type and operating leases; loans and consumption-based financing arrangements; and underwriting, management, and disposal of IT equipment and assets. Its financing operations comprise sales, pricing, credit, contracts, accounting, and risk and asset management. This segment primarily finances IT, communication-related, and medical equipment; and industrial machinery and equipment, office furniture and general office equipment, transportation equipment, and other general business equipment directly, as well as through vendors. The company serves commercial entities, state and local governments, government contractors, healthcare, and educational institutions. The company was formerly known as MLC Holdings, Inc. and changed its name to ePlus inc. in 1999. ePlus inc. was founded in 1990 and is headquartered in Herndon, Virginia.