Critical Review: Crossroads Systems (CRDSQ) versus The Competition

Crossroads Systems (OTCMKTS: CRDSQ) is one of 20 publicly-traded companies in the “Computer Peripherals” industry, but how does it compare to its competitors? We will compare Crossroads Systems to related businesses based on the strength of its risk, valuation, institutional ownership, profitability, earnings, analyst recommendations and dividends.

Earnings & Valuation

This table compares Crossroads Systems and its competitors gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Crossroads Systems N/A N/A -2.50
Crossroads Systems Competitors $1.12 billion $5.60 million -111.65

Crossroads Systems’ competitors have higher revenue and earnings than Crossroads Systems. Crossroads Systems is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Volatility & Risk

Crossroads Systems has a beta of 2.74, suggesting that its share price is 174% more volatile than the S&P 500. Comparatively, Crossroads Systems’ competitors have a beta of 0.86, suggesting that their average share price is 14% less volatile than the S&P 500.

Profitability

This table compares Crossroads Systems and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Crossroads Systems -518.75% -22.99% -7.88%
Crossroads Systems Competitors -258.49% -17.91% -8.72%

Institutional & Insider Ownership

7.5% of Crossroads Systems shares are held by institutional investors. Comparatively, 39.1% of shares of all “Computer Peripherals” companies are held by institutional investors. 27.4% of Crossroads Systems shares are held by insiders. Comparatively, 17.6% of shares of all “Computer Peripherals” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Crossroads Systems and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Crossroads Systems 0 0 0 0 N/A
Crossroads Systems Competitors 50 252 412 14 2.54

As a group, “Computer Peripherals” companies have a potential upside of 16.79%. Given Crossroads Systems’ competitors higher probable upside, analysts clearly believe Crossroads Systems has less favorable growth aspects than its competitors.

Summary

Crossroads Systems competitors beat Crossroads Systems on 5 of the 8 factors compared.

About Crossroads Systems

Crossroads Systems, Inc. is an intellectual property licensing company. The Company’s intellectual property assets are identified in two distinct categories: the first category is known as the 972 patent family and the second category is known as the non-972 patents. As of October 31, 2016, the 972 patent family consisted of 31 patents and pending patents that are primarily concentrated around access controls. As of October 31, 2016, the non-972 patents consisted of 140 patents and pending patents that are primarily directed to five product families: optimizing command processing, enabling interoperability, managing networks, enhancing tape libraries and improving data systems. As of October 31, 2016, approximately 50 companies have licensed 972 patents from the Company. The Company’s subsidiaries include Crossroads Systems (Texas), Inc. and Crossroads Europe GmbH.

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