Analyzing CommScope Holding (COMM) and AudioCodes (AUDC)

CommScope Holding (NASDAQ: COMM) and AudioCodes (NASDAQ:AUDC) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, analyst recommendations and risk.

Institutional & Insider Ownership

22.0% of AudioCodes shares are held by institutional investors. 3.3% of CommScope Holding shares are held by company insiders. Comparatively, 48.8% of AudioCodes shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares CommScope Holding and AudioCodes’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
CommScope Holding $4.78 billion 1.31 $1.08 billion $1.21 26.73
AudioCodes $151.06 million 1.52 $10.30 million $0.54 13.48

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

Risk & Volatility

CommScope Holding has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, AudioCodes has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for CommScope Holding and AudioCodes, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CommScope Holding 0 5 8 0 2.62
AudioCodes 0 1 2 0 2.67

CommScope Holding presently has a consensus price target of $41.20, indicating a potential upside of 27.40%. AudioCodes has a consensus price target of $7.50, indicating a potential upside of 3.02%. Given CommScope Holding’s higher possible upside, equities analysts clearly believe CommScope Holding is more favorable than AudioCodes.

Profitability

This table compares CommScope Holding and AudioCodes’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CommScope Holding 4.96% 33.38% 6.65%
AudioCodes 11.95% 7.78% 4.47%

Summary

CommScope Holding beats AudioCodes on 8 of the 14 factors compared between the two stocks.

CommScope Holding Company Profile

CommScope Holding Company, Inc. (CommScope) is a provider of infrastructure solutions for the core, access and edge layers of communications networks. The Company operates through two segments: CommScope Connectivity Solutions (CCS) and CommScope Mobility Solutions (CMS). Its portfolio includes wireless and fiber optic solutions. The Company’s solutions are found in the venues and outdoor spaces, including in data centers and buildings of all shapes, sizes and complexities; at wireless cell sites; in telecom central offices and cable head ends; in fiber-to-the-X (FTTX) deployments, and in airports, trains and tunnels. As of December 31, 2016, it served customers in over 100 countries through a network of more than 30 manufacturing and distribution facilities located around the globe. Its customers include global telecommunication operators and enterprise customers, including Fortune 500 enterprises and multi-system operators (MSOs).

AudioCodes Company Profile

AudioCodes Ltd. designs, develops and sells Voice over-Internet Protocol (VoIP) and converged VoIP, and data networking solutions, products and applications that facilitate Unified Communications (UC) and Contact Center (CC) services. The Company categorizes its products and services into two main business lines: network and technology. Network products consist of customer premises equipment (CPE), gateways for the enterprise and service provider (or carrier) markets and of carrier-grade-oriented low- and mid-density media gateways for service providers and Enterprise Session Border Controls (ESBCs). Complementing its media gateways and session border gateways as network products are its multi-service business routers (MSBR), Internet Protocol (IP) phones, media servers, mobile VoIP solutions and value added application products. Technology products consist of its chips and boards business products. Its products are deployed in enterprise, service provider cloud networks.

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