ADVA Optical Networking (ADVOF) and UTStarcom (UTSI) Financial Contrast

ADVA Optical Networking (OTCMKTS: ADVOF) and UTStarcom (NASDAQ:UTSI) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Analyst Ratings

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This is a summary of current recommendations and price targets for ADVA Optical Networking and UTStarcom, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ADVA Optical Networking	0	0	0	0	N/A
UTStarcom	0	0	1	0	3.00

UTStarcom has a consensus target price of $5.00, suggesting a potential upside of 6.16%. Given UTStarcom’s higher possible upside, analysts clearly believe UTStarcom is more favorable than ADVA Optical Networking.

Earnings & Valuation

This table compares ADVA Optical Networking and UTStarcom’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ADVA Optical Networking	$581.16 million	0.61	-$4.77 million	$0.08	89.64
UTStarcom	$98.29 million	1.70	$6.98 million	N/A	N/A

UTStarcom has lower revenue, but higher earnings than ADVA Optical Networking.

Risk and Volatility

ADVA Optical Networking has a beta of 2.43, meaning that its stock price is 143% more volatile than the S&P 500. Comparatively, UTStarcom has a beta of 0.29, meaning that its stock price is 71% less volatile than the S&P 500.

Profitability

This table compares ADVA Optical Networking and UTStarcom’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ADVA Optical Networking	-2.71%	0.25%	0.12%
UTStarcom	N/A	N/A	N/A

Institutional and Insider Ownership

5.3% of UTStarcom shares are held by institutional investors. 2.7% of UTStarcom shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

UTStarcom beats ADVA Optical Networking on 7 of the 11 factors compared between the two stocks.

About ADVA Optical Networking

ADVA Optical Networking SE develops, manufactures, and sells optical and Ethernet-based networking solutions to deliver data, storage, voice, and video services worldwide. It offers scalable optical transport solutions, such as FSP 3000 AgileConnect, FSP 3000 CloudConnect, and FSP 3000 AccessConnect; packet edge and aggregation products, including carrier Ethernet and programmable demarcation, edge aggregation, and edge computing products; and network virtualization products comprising ensemble connectors, controllers, and orchestrators. The company also provides timing and synchronization products; network infrastructure assurance products; and automated network management products, such as FSP service manager, FSP network manager, FSP network hypervisor, ensemble portal, and Pro-Vision products that offer a unified platform for network operations. In addition, it provides professional services to plan, operate, and maintain the networks. The company sells its products to telecommunications service providers, private companies, universities, and government agencies directly, as well as through a network of distribution partners. The company was founded in 1994 and is headquartered in Munich, Germany.

About UTStarcom

UTStarcom Holdings Corp., together with its subsidiaries, operates as a telecom infrastructure provider to develop technology for bandwidth from cloud-based services, mobile, streaming, and other applications. The company offers broadband packet optical transport and wireless/fixed-line access products and solutions. It focuses on delivering carrier-class broadband transport and access products and solutions optimized for mobile backhaul, metro aggregation, broadband access, Wi-Fi data, and value added services. The company provides optical transport products, such as packet transport network, next generation packet transport network, and SyncRing product lines that convert and translate data, video, voice, or other traffic into an optical signal that is transmitted over glass fiber; and SOO network (software-defined open packet optical) solution, which helps telecom operators to address the challenges related to the growth of mobile and cloud services, media streaming, and social networking, as well as new applications and services. It also offers carrier Wi-Fi products, such as solutions for managed wireless access networks, including wireless access controllers, VAS platforms, network management systems, and Wi-Fi access points for carrier and MSO markets, as well as various deployment scenarios; and a range of services, such as IPTV, high-speed Internet access, POTS, ISDN, VoIP, over twisted pair copper, and optical fiber. The company was founded in 1991 and is based in Admiralty, Hong Kong.