Reviewing UTStarcom (UTSI) and ARRIS International (NASDAQ:ARRS)

UTStarcom (NASDAQ: UTSI) and ARRIS International (NASDAQ:ARRS) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, analyst recommendations, risk, valuation, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for UTStarcom and ARRIS International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
UTStarcom 0 0 1 0 3.00
ARRIS International 0 3 5 0 2.63

UTStarcom currently has a consensus target price of $5.00, indicating a potential downside of 17.36%. ARRIS International has a consensus target price of $33.13, indicating a potential upside of 29.95%. Given ARRIS International’s higher probable upside, analysts clearly believe ARRIS International is more favorable than UTStarcom.

Profitability

This table compares UTStarcom and ARRIS International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
UTStarcom N/A N/A N/A
ARRIS International 2.51% 14.02% 5.89%

Insider & Institutional Ownership

27.0% of UTStarcom shares are owned by institutional investors. Comparatively, 86.5% of ARRIS International shares are owned by institutional investors. 2.7% of UTStarcom shares are owned by company insiders. Comparatively, 0.9% of ARRIS International shares are owned 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.

Earnings and Valuation

This table compares UTStarcom and ARRIS International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
UTStarcom $80.18 million 2.67 $290,000.00 N/A N/A
ARRIS International $6.83 billion 0.70 $18.10 million $0.87 29.30

ARRIS International has higher revenue and earnings than UTStarcom.

Summary

ARRIS International beats UTStarcom on 8 of the 12 factors compared between the two stocks.

About UTStarcom

UTStarcom Holdings Corp. provides broadband products, solution and services. The Company delivers broadband transport and access (both wireless fidelity (Wi-Fi) and fixed line) products and solutions, optimized for mobile backhaul, metro aggregation, broadband access and Wi-Fi data offloading. Its segments include Equipment, which is focused on its equipment sales, including network infrastructure and application products, and Services, which is engaged in providing services and support of its equipment products and also the new operational support segment. The broadband product lines include family of packet transport network (PTN) products based on multi-protocol label switch transport profile (MPLS-TP) and carrier Ethernet (CE) technologies enhanced through in-house software-defined networking (SDN) platform to support the network evolution, and multi services access network (MSAN) platform. Wireless broadband access is represented by end-to-end Carrier Wi-Fi solution.

About ARRIS International

ARRIS International plc is a media entertainment and data communications solutions provider. The Company operates in two segments: Customer Premises Equipment (CPE), and Network & Cloud (N&C). The Company enables service providers, including cable, telephone, and digital broadcast satellite operators, and media programmers to deliver media, voice and Internet Protocol (IP) data services to their subscribers. It is engaged in offering set-tops, digital video and IP television (IPTV) distribution systems, broadband access infrastructure platforms, and associated data and voice CPE, which it also sells directly to consumers through retail channels. Its solutions are complemented by an array of services, including technical support, repair and refurbishment, and system design and integration. The CPE segment consists of CPE Products-Video and CPE Products-Broadband. The N&C segment consists of Infrastructure Products, Cloud Software and Global Services.

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