Head to Head Comparison: EMCORE (EMKR) & Aerohive Networks (NYSE:HIVE)

Aerohive Networks (NYSE: HIVE) and EMCORE (NASDAQ:EMKR) are both small-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, dividends, profitability, risk and valuation.

Risk and Volatility

Aerohive Networks has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, EMCORE has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500.

Institutional & Insider Ownership

46.1% of Aerohive Networks shares are held by institutional investors. Comparatively, 75.4% of EMCORE shares are held by institutional investors. 26.2% of Aerohive Networks shares are held by insiders. Comparatively, 2.0% of EMCORE shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Aerohive Networks and EMCORE’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aerohive Networks $152.90 million 1.46 -$36.91 million ($0.42) -9.90
EMCORE $122.89 million 1.15 $8.23 million $0.24 21.67

EMCORE has lower revenue, but higher earnings than Aerohive Networks. Aerohive Networks is trading at a lower price-to-earnings ratio than EMCORE, 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 Aerohive Networks and EMCORE, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aerohive Networks 0 1 4 0 2.80
EMCORE 0 2 1 0 2.33

Aerohive Networks currently has a consensus target price of $6.67, indicating a potential upside of 60.26%. EMCORE has a consensus target price of $6.67, indicating a potential upside of 28.21%. Given Aerohive Networks’ stronger consensus rating and higher possible upside, equities analysts clearly believe Aerohive Networks is more favorable than EMCORE.

Profitability

This table compares Aerohive Networks and EMCORE’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aerohive Networks -14.99% -92.83% -16.10%
EMCORE 5.48% 6.59% 5.56%

Aerohive Networks Company Profile

Aerohive Networks, Inc. together with its subsidiaries, has designed and developed a cloud-managed mobile networking platform that enables enterprises to deploy and manage a mobile-centric network edge. Its portfolio of products and solutions is built around sets of technologies and solutions, which include Enterprise Cloud Networking, Wireless Fidelity (Wi-Fi) Connectivity and Application and Insights. It conducts its business in geographic regions, including Americas; Europe, the Middle East and Africa, and Asia Pacific. Its product portfolio includes hardware products, cloud-based network management and applications, and support services. Its hardware products include access points, branch routers and access switches. Its hardware products are developed by its hardware design team working in conjunction with original design manufacturer partners, and leverage the commercially available Wi-Fi radios, network processors, crypto accelerators and switching chips.

EMCORE Company Profile

EMCORE Corporation is engaged in designing and manufacturing indium phosphide (InP) optical chips, components, subsystems and systems for the broadband and specialty fiber optics market. The Company focuses on linear fiber optic transmission technology. The Company operates through Fiber Optics segment. The Company provides optical components, and also end-to-end solutions for high-speed communications network infrastructures. The Company’s optical technologies are designed for cable television (CATV) and fiber-to-the-premise (FTTP) networks, telecommunications and data centers, satellite communications, aerospace and defense, wireless networks, and broadcast and professional audio/video systems. The Company’s fiber optics products enable information that is modulated on light signals to be transmitted, routed (switched) and received in communication systems and networks.

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