Comparing Calix (CALX) and Viavi Solutions (VIAV)

Calix (NYSE: CALX) and Viavi Solutions (NASDAQ:VIAV) are both small-cap technology companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, dividends, earnings and risk.

Risk and Volatility

Calix has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Viavi Solutions has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Calix and Viavi Solutions, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Calix 0 2 0 0 2.00
Viavi Solutions 0 2 5 0 2.71

Calix currently has a consensus price target of $6.50, indicating a potential upside of 9.24%. Viavi Solutions has a consensus price target of $12.50, indicating a potential upside of 43.02%. Given Viavi Solutions’ stronger consensus rating and higher possible upside, analysts clearly believe Viavi Solutions is more favorable than Calix.

Profitability

This table compares Calix and Viavi Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Calix -16.19% -43.76% -22.97%
Viavi Solutions 10.57% 8.99% 3.44%

Insider and Institutional Ownership

67.1% of Calix shares are owned by institutional investors. Comparatively, 92.4% of Viavi Solutions shares are owned by institutional investors. 16.5% of Calix shares are owned by insiders. Comparatively, 0.6% of Viavi Solutions shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Calix and Viavi Solutions’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Calix $458.79 million 0.65 -$27.40 million ($1.64) -3.63
Viavi Solutions $811.40 million 2.45 $166.90 million $0.36 24.28

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

Summary

Viavi Solutions beats Calix on 13 of the 14 factors compared between the two stocks.

About Calix

Calix, Inc. provides broadband communications access systems and software for fiber- and copper-based network architectures that enable communications service providers (CSPs), to transform their networks and connect to their residential and business subscribers. The Company enables CSPs to provide various services, from basic voice and data to advanced broadband services, over legacy and next-generation access networks. It develops and sells carrier-class hardware and cloud products. Its portfolio consists of three core systems and/or nodes: E-Series access systems and nodes (E-Series systems and nodes), B6 access nodes (B-Series nodes), and the C7 multiservice, multiprotocol access system (C-Series system). These systems and nodes are complemented by the P-Series optical network terminals and residential gateways, the GigaFamily of GigaCenters, GigaHubs, and GigaPoints, the Calix Management System, OpenLink Cable software and Compass Cloud family of software-as-a-service products.

About Viavi Solutions

Viavi Solutions Inc. (Viavi) is a provider of network test, monitoring and assurance solutions to communications service providers, enterprises and their ecosystems. The Company also offers thin film optical coatings, providing light management solutions to anti-counterfeiting, consumer and industrial, government and healthcare and other markets. The Company’s segments include Network Enablement (NE), Service Enablement (SE), and Optical Security and Performance Products (OSP). The NE segment provides testing solutions that access the network to perform build-out and maintenance tasks. The SE segment offers solutions, which are embedded systems that yield network, service and application performance data. The OSP segment provides optical security solutions. The OSP segment’s security offerings for the currency market include Optically Variable Pigment (OVP), Optically Variable Magnetic Pigment (OVMP) and banknote thread substrates.

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