Head-To-Head Comparison: ePlus (NASDAQ:PLUS) & Fabrinet (NYSE:FN)

ePlus (NASDAQ:PLUS) and Fabrinet (NYSE:FN) are both technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, valuation, dividends and profitability.

Institutional and Insider Ownership

93.8% of ePlus shares are held by institutional investors. Comparatively, 97.4% of Fabrinet shares are held by institutional investors. 2.2% of ePlus shares are held by insiders. Comparatively, 0.2% of Fabrinet shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for ePlus and Fabrinet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ePlus	0	2	0	0	2.00
Fabrinet	0	4	6	0	2.60

Fabrinet has a consensus target price of $649.50, suggesting a potential upside of 43.78%. Given Fabrinet’s stronger consensus rating and higher possible upside, analysts clearly believe Fabrinet is more favorable than ePlus.

Profitability

This table compares ePlus and Fabrinet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ePlus	4.91%	11.51%	6.73%
Fabrinet	10.19%	21.23%	13.96%

Risk and Volatility

ePlus has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500. Comparatively, Fabrinet has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500.

Valuation and Earnings

This table compares ePlus and Fabrinet”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ePlus	$2.44 billion	0.99	$132.64 million	$4.57	20.33
Fabrinet	$4.64 billion	3.49	$473.03 million	$13.05	34.61

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

Summary

Fabrinet beats ePlus on 13 of the 14 factors compared between the two stocks.

About ePlus

ePlus inc., together with its subsidiaries, provides information technology (IT) solutions that enable organizations to optimize their IT environment and supply chain processes in the United States and internationally. It operates through two segments, Technology and Financing. The Technology segment offers hardware, perpetual and subscription software, maintenance, software assurance, and internally provided and outsourced services; managed services or infrastructure and cloud; and enhanced maintenance support, service desk, storage-as-a-service, cloud hosted and managed, and managed security services; and professional, staff augmentation, cloud consulting, consulting, and security services. The Financing segment engages in financing arrangements, such as sales-type and operating leases; loans and consumption-based financing arrangements; and underwriting, management, and disposal of IT equipment and assets. Its financing operations comprise sales, pricing, credit, contracts, accounting, and risk and asset management. This segment primarily finances IT, communication-related, and medical equipment; and industrial machinery and equipment, office furniture and general office equipment, transportation equipment, and other general business equipment directly, as well as through vendors. The company serves commercial entities, state and local governments, government contractors, healthcare, and educational institutions. The company was formerly known as MLC Holdings, Inc. and changed its name to ePlus inc. in 1999. ePlus inc. was founded in 1990 and is headquartered in Herndon, Virginia.

About Fabrinet

Fabrinet provides optical packaging and precision optical, electro-mechanical, and electronic manufacturing services in North America, the Asia-Pacific, and Europe. The company offers a range of advanced optical and electro-mechanical capabilities in the manufacturing process, including process design and engineering, supply chain management, manufacturing, printed circuit board assembly, advanced packaging, integration, final assembly, and testing. Its products include switching products, including reconfigurable optical add-drop multiplexers, optical amplifiers, modulators, and other optical components and modules that enable network managers to route voice, video, and data communications traffic through fiber optic cables at various wavelengths, speeds, and over various distances. The company's products also comprise tunable lasers, transceivers, and transponders; and active optical cables, which provide high-speed interconnect capabilities for data centers and computing clusters, as well as Infiniband, Ethernet, fiber channel, and optical backplane connectivity. In addition, it provides solid state, diode-pumped, gas, and fiber lasers used in semiconductor processing, biotechnology and medical device, metrology, and material processing industries; and differential pressure, micro-gyro, fuel, and other sensors used in automobiles, as well as non-contact temperature measurement sensors for the medical industry. Further, the company designs and fabricates application-specific crystals, lenses, prisms, mirrors, laser components, and substrates; and other custom and standard borosilicate, clear fused quartz, and synthetic fused silica glass products. It serves original equipment manufacturers of optical communication components, modules and sub-systems, industrial lasers, automotive components, medical devices, and sensors. The company was incorporated in 1999 and is based in Grand Cayman, the Cayman Islands.