Digimarc (NASDAQ: DMRC) and NetScout Systems (NASDAQ:NTCT) are both industrial products companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.
Volatility & Risk
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Digimarc has a beta of -1.02, meaning that its share price is 202% less volatile than the S&P 500. Comparatively, NetScout Systems has a beta of 1.52, meaning that its share price is 52% more volatile than the S&P 500.
Insider and Institutional Ownership
54.3% of Digimarc shares are held by institutional investors. 7.5% of Digimarc shares are held by company insiders. Comparatively, 3.5% of NetScout Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This is a breakdown of recent ratings and price targets for Digimarc and NetScout Systems, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Digimarc currently has a consensus price target of $43.00, indicating a potential upside of 52.21%. NetScout Systems has a consensus price target of $27.80, indicating a potential upside of 1.20%. Given Digimarc’s stronger consensus rating and higher possible upside, equities analysts clearly believe Digimarc is more favorable than NetScout Systems.
Valuation and Earnings
This table compares Digimarc and NetScout Systems’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Digimarc||$25.21 million||13.28||-$25.77 million||($2.44)||-11.58|
|NetScout Systems||$986.79 million||2.23||$79.81 million||$0.99||27.75|
NetScout Systems has higher revenue and earnings than Digimarc. Digimarc is trading at a lower price-to-earnings ratio than NetScout Systems, indicating that it is currently the more affordable of the two stocks.
This table compares Digimarc and NetScout Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
NetScout Systems beats Digimarc on 8 of the 14 factors compared between the two stocks.
Digimarc Corporation provides media identification and management solutions to commercial entities and government customers in the United States and internationally. The company offers Digimarc Intuitive Computing Platform, a comprehensive set of technologies for identifying, discovering, and interacting with digitally-enhanced media, which includes Digimarc Barcode, a method for imperceptibly enhancing packaging, print, images, thermal labels, audio, and other objects with data that is detected by enabled devices, such as smart phones, computers, barcode scanners, and machine-vision equipment. It also provides Digimarc Discover software that enables an ecosystem of connected devices to identify content or materials and deliver information. The company's solutions identify, track, manage, and protect content; and enable new consumer applications to access networks and information from personal computers and mobile devices. Its solutions are used in various media identification and management products and solutions, such as counterfeiting and piracy deterrence; online e-publication piracy protection; content identification and media management; authentication and monitoring; retail point of sale transaction processing; linking to networks and providing access to information; and enhanced services in support of mobile commerce. The company provides its solutions directly and through its business partners. Digimarc Corporation was founded in 2008 and is based in Beaverton, Oregon.
About NetScout Systems
NetScout Systems, Inc. provides real-time operational intelligence and performance analytics for service assurance, and cybersecurity solutions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that enables customers to predict, preempt, and resolve network and service delivery problems, as well as facilitate the optimization and capacity planning of their network infrastructures; and specialized platforms and analytic modules that enable its customers to analyze and troubleshoot traffic in radio access and WiFi networks, as well as gain timely insight into services, applications, and systems. It also provides Intelligent Data Sources under the Infinistream brand name that provide real-time collection and analysis of data from the network; packet flow switching solutions that delivers targeted network traffic access to an increasing number of monitoring and security systems; and a suite of test access points that enable non-disruptive access to network traffic with multiple link type and speed options. In addition, the company offers portable network analysis and troubleshooting tools, which help customers identify key issues that impact network and application performance. Further, it provides security solutions that enable service providers and enterprises to protect their networks against DDoS attacks; and threat detection solutions that enable enterprises to identify and investigate advanced threat campaigns that present tangible risks to the integrity of their networks. The company serves enterprise customers in industries, such as financial services, technology, manufacturing, healthcare, utilities, education, transportation, and retail; mobile operators, wireline operators, and cable operators; and governmental agencies through a direct sales force, and indirect reseller and distribution channels. NetScout Systems, Inc. was founded in 1984 and is headquartered in Westford, Massachusetts.