Financial Analysis: Cisco Systems (NASDAQ:CSCO) vs. Franklin Wireless (NASDAQ:FKWL)

Franklin Wireless (NASDAQ:FKWL) and Cisco Systems (NASDAQ:CSCO) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, institutional ownership, profitability and risk.

Analyst Ratings

This is a summary of current ratings for Franklin Wireless and Cisco Systems, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin Wireless	1	0	1	0	2.00
Cisco Systems	0	9	17	0	2.65

Franklin Wireless currently has a consensus price target of $6.00, indicating a potential upside of 32.45%. Cisco Systems has a consensus price target of $84.14, indicating a potential upside of 9.45%. Given Franklin Wireless’ higher probable upside, equities research analysts plainly believe Franklin Wireless is more favorable than Cisco Systems.

Institutional and Insider Ownership

18.5% of Franklin Wireless shares are owned by institutional investors. Comparatively, 73.3% of Cisco Systems shares are owned by institutional investors. 28.4% of Franklin Wireless shares are owned by company insiders. Comparatively, 0.0% of Cisco Systems shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Franklin Wireless has a beta of 0.25, suggesting that its stock price is 75% less volatile than the S&P 500. Comparatively, Cisco Systems has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500.

Profitability

This table compares Franklin Wireless and Cisco Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin Wireless	-0.26%	-0.31%	-0.23%
Cisco Systems	18.38%	27.29%	10.43%

Earnings & Valuation

This table compares Franklin Wireless and Cisco Systems”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin Wireless	$46.09 million	N/A	-$240,000.00	($0.01)	-453.00
Cisco Systems	$56.65 billion	5.36	$10.18 billion	$2.66	28.90

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

Summary

Cisco Systems beats Franklin Wireless on 11 of the 13 factors compared between the two stocks.

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.

About Cisco Systems

Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.