Financial Analysis: NetSol Technologies (NTWK) and Echelon Corporation (ELON)
NetSol Technologies (NASDAQ: NTWK) and Echelon Corporation (NASDAQ:ELON) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.
This table compares NetSol Technologies and Echelon Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional & Insider Ownership
20.6% of NetSol Technologies shares are held by institutional investors. Comparatively, 19.3% of Echelon Corporation shares are held by institutional investors. 11.1% of NetSol Technologies shares are held by insiders. Comparatively, 9.1% of Echelon Corporation shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares NetSol Technologies and Echelon Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|NetSol Technologies||$69.96 million||0.71||$12.02 million||($0.01)||-444.56|
|Echelon Corporation||$31.50 million||0.70||-$4.38 million||($1.15)||-4.31|
NetSol Technologies has higher revenue and earnings than Echelon Corporation. NetSol Technologies is trading at a lower price-to-earnings ratio than Echelon Corporation, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
NetSol Technologies has a beta of 0.72, suggesting that its share price is 28% less volatile than the S&P 500. Comparatively, Echelon Corporation has a beta of -0.54, suggesting that its share price is 154% less volatile than the S&P 500.
This is a summary of current ratings and target prices for NetSol Technologies and Echelon Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
NetSol Technologies beats Echelon Corporation on 10 of the 10 factors compared between the two stocks.
NetSol Technologies Company Profile
NetSol Technologies, Inc. is a provider of information technology (IT) and enterprise software solutions. The Company is engaged in the licensing, customization, enhancement and maintenance of its suite of financial applications under the brand names, NetSol Financial Suite (NFS) and NFS Ascent, for businesses in the lease and finance industry. The Company’s segments include North America, Europe and Asia-Pacific. The Company’s offerings include its global solution, NFS. The four applications under NFS have been designed and developed for a setting, and deals with multinational, multi-company, multi-asset, multi-lingual, multi-distributor and multi-manufacturer environments. Each application is used independently to address specific sub-domains of the leasing/financing cycle. The Company’s platform, NFS Ascent, offers a solution for the auto and equipment finance and leasing industry. NFS Ascent platform is a lease accounting and contract processing engine.
Echelon Corporation Company Profile
Echelon Corporation develops open-standard control networking platforms and delivers elements necessary to design, install, monitor and control communities of devices. The Company’s products enable everyday devices, such as air conditioners, outdoor lighting, appliances, electricity meters, light switches, thermostats and valves to be inter-connected and be part of the Industrial Internet of Things (IIoT) market. It operates through the IIoT segment. Its IIoT business sells products and services that form embedded control platforms, such as LONWORKS and IzoT. The Company’s IIoT business also sells products and services, which include components, control nodes and development software. The Company also offers a solution consisting of outdoor lighting controllers, segment controllers, gateways and software to end customers, such as municipalities, cities, campuses and commercial enterprises. The Company markets its products under the Echelon brand.
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