Hudson Technologies (NASDAQ:HDSN) vs. ScanSource (NASDAQ:SCSC) Critical Comparison

Hudson Technologies (NASDAQ:HDSN) and ScanSource (NASDAQ:SCSC) are both small-cap industrials companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, analyst recommendations, profitability, valuation, earnings and risk.

Analyst Ratings

This is a breakdown of current ratings for Hudson Technologies and ScanSource, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hudson Technologies	0	2	3	0	2.60
ScanSource	0	1	1	0	2.50

Hudson Technologies currently has a consensus price target of $8.6250, suggesting a potential downside of 11.90%. ScanSource has a consensus price target of $42.00, suggesting a potential downside of 7.22%. Given ScanSource’s higher probable upside, analysts clearly believe ScanSource is more favorable than Hudson Technologies.

Profitability

This table compares Hudson Technologies and ScanSource’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hudson Technologies	8.08%	7.26%	5.87%
ScanSource	2.27%	8.96%	4.68%

Volatility and Risk

Hudson Technologies has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500. Comparatively, ScanSource has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500.

Insider & Institutional Ownership

71.3% of Hudson Technologies shares are held by institutional investors. Comparatively, 97.9% of ScanSource shares are held by institutional investors. 8.0% of Hudson Technologies shares are held by insiders. Comparatively, 4.2% of ScanSource shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Hudson Technologies and ScanSource”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hudson Technologies	$237.12 million	1.80	$24.39 million	$0.40	24.48
ScanSource	$3.26 billion	0.31	$77.06 million	$2.77	16.34

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

About Hudson Technologies

Hudson Technologies, Inc., through its subsidiary, Hudson Technologies Company, engages in the provision of solutions to recurring problems within the refrigeration industry in the United States. The company engages in the sale of refrigerant and industrial gas; provision of refrigerant management services consisting primarily of reclamation of refrigerants, re-usable cylinder refurbishment, and hydrostatic testing services; and RefrigerantSide services comprising system decontamination and recovery to remove moisture, oils, and other contaminants. It also offers Chiller Chemistry, which integrates several fluid tests of an operating system and the corresponding laboratory results into an engineering report; Fluid Chemistry, an abbreviated version of Chiller Chemistry, which is designed to quickly identify systems that require further examination; SmartEnergy OPS, a web-based real time continuous monitoring system, for measuring, modifying and improving the efficiency of energy systems, including air conditioning and refrigeration systems, in industrial and commercial applications; and ChillSmart, which combines the system optimization with Chiller Chemistry for providing a snapshot of a packaged chiller's operating efficiency and health. In addition, the company participates in the generation of carbon offset projects. It serves commercial, industrial, and governmental customers, as well as refrigerant wholesalers, distributors, contractors, and refrigeration equipment manufacturers. The company was incorporated in 1991 and is headquartered in Woodcliff Lake, New Jersey.

About ScanSource

ScanSource, Inc. engages in the distribution of technology products and solutions in the United States, Canada, and Brazil. It operates through two segments, Specialty Technology Solutions and Modern Communications & Cloud. The Specialty Technology Solutions segment provides a portfolio of solutions primarily for enterprise mobile computing, data capture, barcode printing, point of sale (POS), payments, networking, electronic physical security, cyber security, and other technologies. This segment offers data capture and POS solutions to automate the collection, processing, and communication of information for commercial and industrial applications, including retail sales, distribution, shipping, inventory control, materials handling, warehouse management, and health care applications. It also provides electronic physical security products, such as identification, access control, video surveillance, and intrusion-related devices; networking products comprising wireless and networking infrastructure products; other software-as-a-service (SaaS) products; and engages in hardware rental activities. The Modern Communications & Cloud segment offers a portfolio of solutions primarily for communications technologies and services comprising voice, video conferencing, wireless, data networking, cybersecurity, cable, unified communications and collaboration, cloud, and technology services, as well as IP networks and other solutions for various vertical markets, such as education, healthcare, and government. The company serves manufacturing, warehouse and distribution, retail and e-commerce, hospitality, transportation and logistics, government, education and healthcare, and other industries. ScanSource, Inc. was incorporated in 1992 and is headquartered in Greenville, South Carolina.