Extreme Networks (NASDAQ:EXTR) and Applied Optoelectronics (NASDAQ:AAOI) Financial Survey

Extreme Networks (NASDAQ:EXTR) and Applied Optoelectronics (NASDAQ:AAOI) are both mid-cap technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, analyst recommendations, profitability and institutional ownership.

Earnings and Valuation

This table compares Extreme Networks and Applied Optoelectronics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Extreme Networks	$1.28 billion	2.21	$42.12 million	$0.31	69.39
Applied Optoelectronics	$455.71 million	18.40	-$38.23 million	($0.78)	-127.08

Extreme Networks has higher revenue and earnings than Applied Optoelectronics. Applied Optoelectronics is trading at a lower price-to-earnings ratio than Extreme Networks, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and price targets for Extreme Networks and Applied Optoelectronics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Extreme Networks	0	2	7	0	2.78
Applied Optoelectronics	1	2	3	0	2.33

Extreme Networks currently has a consensus target price of $32.25, indicating a potential upside of 49.92%. Applied Optoelectronics has a consensus target price of $139.40, indicating a potential upside of 40.63%. Given Extreme Networks’ stronger consensus rating and higher probable upside, equities analysts plainly believe Extreme Networks is more favorable than Applied Optoelectronics.

Institutional & Insider Ownership

91.1% of Extreme Networks shares are held by institutional investors. Comparatively, 61.7% of Applied Optoelectronics shares are held by institutional investors. 3.6% of Extreme Networks shares are held by insiders. Comparatively, 3.8% of Applied Optoelectronics shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Extreme Networks and Applied Optoelectronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Extreme Networks	3.28%	88.88%	6.32%
Applied Optoelectronics	-9.57%	-1.98%	-1.34%

Volatility and Risk

Extreme Networks has a beta of 1.76, indicating that its share price is 76% more volatile than the S&P 500. Comparatively, Applied Optoelectronics has a beta of 3.79, indicating that its share price is 279% more volatile than the S&P 500.

Summary

Extreme Networks beats Applied Optoelectronics on 11 of the 14 factors compared between the two stocks.

About Extreme Networks

Extreme Networks, Inc. delivers cloud-driven networking solutions that leverage the powers of machine learning, artificial intelligence, analytics, and automation.
The company designs, develops, and manufactures wired and wireless network infrastructure equipment and develops the software for network management, policy, analytics, security, and access controls. Over 50,000 customers globally trust their end-to-end, cloud-driven networking solutions and rely on our top-rated services and support to accelerate their digital transformation efforts.

About Applied Optoelectronics

Applied Optoelectronics, Inc. designs, manufactures, and sells fiber-optic networking products in the United States, Taiwan, and China. It offers optical modules, optical filters, lasers, laser components, subassemblies, transmitters and transceivers, turn-key equipment, headend, node, distribution equipment, and amplifiers. The company sells its products to internet data center operators, cable television, telecom equipment manufacturers, fiber-to-the-home, and internet service providers through its direct and indirect sales channels. Applied Optoelectronics, Inc. was incorporated in 1997 and is headquartered in Sugar Land, Texas.