Head-To-Head Analysis: Sierra Wireless (SWIR) & Ixia (XXIA)

Ixia (NASDAQ: XXIA) and Sierra Wireless (NASDAQ:SWIR) are both technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, earnings, risk, dividends and valuation.

Volatility and Risk

Ixia has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, Sierra Wireless has a beta of 3.15, suggesting that its share price is 215% more volatile than the S&P 500.

Profitability

This table compares Ixia and Sierra Wireless’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ixia -29.28% -28.71% -19.71%
Sierra Wireless 3.13% 9.16% 5.84%

Institutional and Insider Ownership

63.6% of Ixia shares are held by institutional investors. Comparatively, 25.0% of Sierra Wireless shares are held by institutional investors. 24.4% of Ixia shares are held by company insiders. Comparatively, 2.0% of Sierra Wireless shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Ixia and Sierra Wireless’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ixia N/A N/A N/A $0.12 163.76
Sierra Wireless $651.88 million 1.11 $42.36 million $0.62 36.61

Sierra Wireless has higher revenue and earnings than Ixia. Sierra Wireless is trading at a lower price-to-earnings ratio than Ixia, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Ixia and Sierra Wireless, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ixia 0 3 1 0 2.25
Sierra Wireless 0 8 2 0 2.20

Ixia currently has a consensus target price of $19.65, indicating a potential upside of 0.00%. Sierra Wireless has a consensus target price of $26.28, indicating a potential upside of 15.78%. Given Sierra Wireless’ higher probable upside, analysts clearly believe Sierra Wireless is more favorable than Ixia.

Summary

Sierra Wireless beats Ixia on 8 of the 11 factors compared between the two stocks.

Ixia Company Profile

Ixia is a provider of physical and virtual network application performance and security resilience solutions. The Company’s product solutions consist of its hardware platforms, software applications and services, including warranty and maintenance offerings. The Company helps its customers to validate the performance and security resilience of their applications and networks. The Company offers network test hardware platforms with interchangeable interfaces, using a common set of applications and Application Programing Interfaces (APIs). The Company provides its solutions to network equipment manufacturers (NEMs), service providers, and enterprise and government organizations. The Company’s product solutions consist of its hardware platforms, such as chassis, interface cards and appliances, software application tools, and services, including its warranty and maintenance offerings and professional services.

Sierra Wireless Company Profile

Sierra Wireless, Inc. is engaged in building the Internet of Things (IoT) with wireless solutions for organizations. The Company’s OEM Solution segment offers cellular embedded wireless modules for IoT connectivity, including an embedded application framework to support customer applications. The Company’s Enterprise Solution segment offers intelligent routers and gateways, including management tools and applications that enable cellular connectivity. The Company’s Cloud and Connectivity Services segment offers a cloud based platform for deploying and managing IoT applications, Smart SIM supported by mobile core networks, and managed wireless broadband services to enable customer IoT deployments. The Company offers a portfolio of second generation, third generation, and fourth generation cellular embedded wireless modules and gateways, integrated with its secure cloud and connectivity services. The Company offers its products to original equipment manufacturers (OEMs) and enterprises.

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