Inventergy Global (OTCMKTS: INVT) and Windstream (NASDAQ:WIN) are both small-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, risk, profitability and valuation.

Volatility and Risk

Inventergy Global has a beta of -0.25, indicating that its share price is 125% less volatile than the S&P 500. Comparatively, Windstream has a beta of 0.3, indicating that its share price is 70% less volatile than the S&P 500.

Profitability

This table compares Inventergy Global and Windstream’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Inventergy Global 2,177.99% 37.76% 23.80%
Windstream -6.49% -64.22% -2.61%

Institutional & Insider Ownership

66.3% of Windstream shares are held by institutional investors. 24.6% of Inventergy Global shares are held by insiders. Comparatively, 1.0% of Windstream shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Windstream pays an annual dividend of $0.55 per share and has a dividend yield of 26.8%. Inventergy Global does not pay a dividend. Windstream pays out -20.0% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Inventergy Global and Windstream’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Inventergy Global $1.77 million 0.91 -$7.73 million $0.89 0.10
Windstream $5.39 billion 0.07 -$383.50 million ($2.75) -0.75

Inventergy Global has higher earnings, but lower revenue than Windstream. Windstream is trading at a lower price-to-earnings ratio than Inventergy Global, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for Inventergy Global and Windstream, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Inventergy Global 0 0 0 0 N/A
Windstream 1 1 1 0 2.00

Windstream has a consensus price target of $3.00, indicating a potential upside of 46.34%. Given Windstream’s higher possible upside, analysts plainly believe Windstream is more favorable than Inventergy Global.

Inventergy Global Company Profile

Inventergy Global, Inc. is an intellectual property (IP) investment and licensing company. The Company offers clients a professional corporate licensing model for IP value creation. The Company’s Technical Lead and associated group works to understand the science and/or technology behind the patents of a particular portfolio, under the review of the Legal Lead and in support of the Business team. This group coordinates the work of third party technology consultants, including technical external resources, such as technical experts, reverse engineering consultancies and other providers, to deliver inputs to the Legal and Business teams. The Legal Lead and Team manage the existing patent asset portfolio from a global perspective and also manage further prosecution of continuing patent cases. The Legal Lead also is responsible for the legal structure and legal documents of any license or negotiated settlement with prospective licensees.

Windstream Company Profile

Windstream Corporation (Windstream) is a provider of advanced communications and technology solutions, including managed services and cloud computing, to businesses nationwide. In addition to business services, the Company offers broadband, voice and video services to consumers in primarily rural markets. It has operations in 48 states and the District of Columbia, a local and long-haul fiber network spanning approximately 115,000 miles, a robust business sales division and 21 data centers offering managed services and cloud computing. Windstream’s owned local networks consist of central office digital switches, routers, loop carriers and virtual and physical colocations interconnected with fiber, copper and microwaved facilities. A mix of fiber optic and copper facilities connect its customers with the core network. In December 2011, the Company announced that it has completed its acquisition of PAETEC Holding Corp.

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