Critical Comparison: Aerohive Networks (NYSE:HIVE) & EMCORE (EMKR)

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

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
EMCORE $122.89 million 1.15 $8.23 million $0.24 21.67
Aerohive Networks $152.90 million 1.47 -$22.93 million ($0.43) -9.77

EMCORE has higher earnings, but lower revenue 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.

Risk and Volatility

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

Analyst Recommendations

This is a breakdown of current recommendations and price targets for EMCORE and Aerohive Networks, as reported by MarketBeat.com.

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

EMCORE currently has a consensus price target of $6.67, suggesting a potential upside of 28.21%. Aerohive Networks has a consensus price target of $6.67, suggesting a potential upside of 58.73%. Given Aerohive Networks’ stronger consensus rating and higher probable upside, analysts clearly believe Aerohive Networks is more favorable than EMCORE.

Institutional & Insider Ownership

74.2% of EMCORE shares are held by institutional investors. Comparatively, 43.6% of Aerohive Networks shares are held by institutional investors. 2.0% of EMCORE shares are held by company insiders. Comparatively, 26.2% of Aerohive Networks shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

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

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

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.

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.

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