Quantenna Communications (NASDAQ:QTNA) and Intermolecular (NASDAQ:IMI) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, analyst recommendations, profitability, institutional ownership and valuation.

Profitability

This table compares Quantenna Communications and Intermolecular’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quantenna Communications 17.07% 3.65% 3.08%
Intermolecular -1.84% -1.91% -1.59%

Earnings & Valuation

This table compares Quantenna Communications and Intermolecular’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Quantenna Communications $176.36 million 3.16 $34.41 million ($0.02) -746.00
Intermolecular $37.20 million 1.27 -$10.40 million N/A N/A

Quantenna Communications has higher revenue and earnings than Intermolecular.

Institutional and Insider Ownership

62.9% of Quantenna Communications shares are held by institutional investors. Comparatively, 39.2% of Intermolecular shares are held by institutional investors. 13.5% of Quantenna Communications shares are held by insiders. Comparatively, 46.0% of Intermolecular 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Quantenna Communications and Intermolecular, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quantenna Communications 0 1 8 1 3.00
Intermolecular 0 0 1 0 3.00

Quantenna Communications presently has a consensus target price of $20.00, indicating a potential upside of 34.05%. Intermolecular has a consensus target price of $3.00, indicating a potential upside of 216.26%. Given Intermolecular’s higher possible upside, analysts clearly believe Intermolecular is more favorable than Quantenna Communications.

Volatility & Risk

Quantenna Communications has a beta of 1.24, meaning that its share price is 24% more volatile than the S&P 500. Comparatively, Intermolecular has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500.

Summary

Quantenna Communications beats Intermolecular on 9 of the 12 factors compared between the two stocks.

About Quantenna Communications

Quantenna Communications, Inc. designs, develops, and markets wireless communication solutions enabling wireless local area networking in the United States and internationally. The company's solutions portfolio comprises radio frequency chips and digital baseband chips, which support the IEEE Wi-Fi standards, including 802.11n, 802.11ac, and draft 802.11ax. It offers its products for home networking applications, including home gateways, repeaters, and set-top boxes, as well as retail, outdoor, small and medium business, enterprise, and consumer electronics applications. The company sells its Wi-Fi solutions directly to original equipment manufacturers and original design manufacturers; and third-party distributors. Quantenna Communications, Inc. was founded in 2005 and is headquartered in Fremont, California.

About Intermolecular

Intermolecular, Inc. engages in the development of advanced materials using high productivity combinatorial (HPC) technology platform for the semiconductors, consumer electronics, automotive, and aerospace industries worldwide. The company's HPC platform includes Tempus processing tools, automated characterization methods, and informatics analysis software for research and development using combinatorial process systems in concert with established chemical vapor deposition, physical vapor deposition, and atomic layer deposition methods. It serves various markets, including semiconductor, glass, advanced alloys, light-emitting diodes, flat-panel displays, and others. The company was formerly known as The BEP Group, Inc. and changed its name to Intermolecular, Inc. in November 2004. Intermolecular, Inc. was founded in 2004 and is headquartered in San Jose, California.

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