Identiv (INVE) & Crossroads Systems (CRDSQ) Critical Review

Identiv (NASDAQ: INVE) and Crossroads Systems (OTCMKTS:CRDSQ) are both small-cap technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, profitability, risk, dividends, earnings and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and price targets for Identiv and Crossroads Systems, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Identiv 0 1 1 0 2.50
Crossroads Systems 0 0 0 0 N/A

Identiv presently has a consensus target price of $8.50, suggesting a potential upside of 108.59%. Given Identiv’s higher possible upside, equities analysts plainly believe Identiv is more favorable than Crossroads Systems.

Institutional & Insider Ownership

40.4% of Identiv shares are held by institutional investors. Comparatively, 7.5% of Crossroads Systems shares are held by institutional investors. 12.3% of Identiv shares are held by company insiders. Comparatively, 27.4% of Crossroads Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

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

Net Margins Return on Equity Return on Assets
Identiv -8.04% -38.59% -8.72%
Crossroads Systems -518.75% -22.99% -7.88%

Earnings & Valuation

This table compares Identiv and Crossroads Systems’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Identiv $56.17 million 1.03 -$13.69 million ($0.38) -10.72
Crossroads Systems N/A N/A N/A ($1.08) -2.50

Crossroads Systems has lower revenue, but higher earnings than Identiv. Identiv is trading at a lower price-to-earnings ratio than Crossroads Systems, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Identiv has a beta of -0.23, suggesting that its share price is 123% less volatile than the S&P 500. Comparatively, Crossroads Systems has a beta of 2.74, suggesting that its share price is 174% more volatile than the S&P 500.

Summary

Identiv beats Crossroads Systems on 6 of the 11 factors compared between the two stocks.

About Identiv

Identiv, Inc. is a global security technology company. The Company operates through four segments: Physical access control systems (PACS), Identity, Credentials and All Other. PACS segment provides solutions and services that enable the issuance, management and use of secure identity credentials in diverse markets. PACS business offers Hirsch line of controllers, including the advanced MX line, Hirsch’s Velocity management software and its Identiv connected physical access manager software, EDGE controller and reader package. Identity segment offers products to secure enterprise information, including login and printers through delivery of smart card reader products and identity management through its idOnDemand service. Credentials segment offers access cards, radio frequency identification (RFID) and near field communication products, including cards, labels, tags and stickers, as well as RF components. All Other segment includes products, such as Chipdrive and Digital Media readers.

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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