Critical Review: Entropic Communications (ENTR) vs. NeoPhotonics Corporation (NYSE:NPTN)

NeoPhotonics Corporation (NYSE: NPTN) and Entropic Communications (NASDAQ:ENTR) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, valuation, risk, earnings and profitability.

Institutional & Insider Ownership

86.6% of NeoPhotonics Corporation shares are owned by institutional investors. 17.3% of NeoPhotonics Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares NeoPhotonics Corporation and Entropic Communications’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
NeoPhotonics Corporation $358.05 million 0.68 $338,000.00 ($0.62) -9.00
Entropic Communications N/A N/A N/A N/A N/A

NeoPhotonics Corporation has higher revenue and earnings than Entropic Communications.

Analyst Ratings

This is a summary of current ratings and recommmendations for NeoPhotonics Corporation and Entropic Communications, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NeoPhotonics Corporation 0 2 5 1 2.88
Entropic Communications 0 0 0 0 N/A

NeoPhotonics Corporation presently has a consensus target price of $10.22, indicating a potential upside of 83.13%. Given NeoPhotonics Corporation’s higher possible upside, equities research analysts clearly believe NeoPhotonics Corporation is more favorable than Entropic Communications.

Profitability

This table compares NeoPhotonics Corporation and Entropic Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NeoPhotonics Corporation -7.28% -9.43% -5.36%
Entropic Communications -10.45% -11.67% -9.68%

Summary

NeoPhotonics Corporation beats Entropic Communications on 9 of the 9 factors compared between the two stocks.

About NeoPhotonics Corporation

NeoPhotonics Corporation develops, manufactures and markets optoelectronic products that transmit, receive and switch digital optical signals for communications networks. The Company develops and manufactures Transmitter Products, Receiver Products and Switch Products that are used in ultra-high speed digital optical communications, high speed switching and provisioning, and access connections for wireless and fiber-to-the-home communications networks. The Company’s products are categorized into groups, including High Speed Products and Network Products and Solutions. The High Speed Products includes products designed for 100G and beyond for telecommunication and datacenter or content provider networks and applications. Its Network Products and Solutions consist of various products designed for applications below 100G, and include 40G products. The Company combines its transmitter and receiver products into Transceiver modules.

About Entropic Communications

Entropic Communications, Inc. (Entropic) is a fabless semiconductor company. Entropic designs, develops and markets semiconductor solutions to enable home entertainment. The Company offers a portfolio of set-top box (STB), Video System-on-a-Chip (SoC) and home connectivity (Connectivity) solutions. Entropic’s Connectivity solutions enable access to broadcast and Internet Protocol television (IPTV) services, as well as deliver and distribute other media content, such as movies, music, games and photos across the home. The Company’s Connectivity solutions include home networking solutions based on the Multimedia over Coax Alliance (MoCA) standard, high-speed broadband access solutions and Direct Broadcast Satellite outdoor unit (DBS ODU) solutions. Entropic’s STB product portfolio consists of a range of digital STB components and system solutions for the satellite, terrestrial, cable and IPTV markets across the world.

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