Electro-Sensors (NASDAQ:ELSE – Get Free Report) and Digital Ally (NASDAQ:KUST – Get Free Report) are both small-cap technology companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.
Risk and Volatility
Electro-Sensors has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500. Comparatively, Digital Ally has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.
Profitability
This table compares Electro-Sensors and Digital Ally’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Electro-Sensors | 2.42% | 1.73% | 1.62% |
| Digital Ally | -96.36% | -277.67% | -56.35% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Electro-Sensors | 0 | 1 | 0 | 0 | 2.00 |
| Digital Ally | 1 | 0 | 0 | 0 | 1.00 |
Valuation & Earnings
This table compares Electro-Sensors and Digital Ally”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Electro-Sensors | $10.48 million | 2.61 | $310,000.00 | $0.08 | 96.75 |
| Digital Ally | $16.51 million | 0.16 | -$6.67 million | ($168.71) | -0.02 |
Electro-Sensors has higher earnings, but lower revenue than Digital Ally. Digital Ally is trading at a lower price-to-earnings ratio than Electro-Sensors, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
11.7% of Electro-Sensors shares are held by institutional investors. Comparatively, 4.2% of Digital Ally shares are held by institutional investors. 13.3% of Electro-Sensors shares are held by company insiders. Comparatively, 0.0% of Digital Ally shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Summary
Electro-Sensors beats Digital Ally on 10 of the 12 factors compared between the two stocks.
About Electro-Sensors
Electro-Sensors, Inc. engages in the manufacture and selling of industrial production monitoring and process control systems. Its products include shaft speed witches; wireless hazard monitoring; temperature sensor; slide gate and angle position; bearing sensors and belt alignment; and motor drive control. The company was founded by James P. Slattery in 1965 and is headquartered in Minnetonka, MN.
About Digital Ally
Digital Ally, Inc. produces and sells digital video imaging, storage, and disinfectant and related safety products for use in law enforcement, security, and commercial applications in the United States and internationally. It operates through Video Solutions, Revenue Cycle Management, and Ticketing segments. The company offers in-car digital video mirror systems for law enforcement; in-car digital video event recorder systems for commercial fleets; a suite of data management web-based tools to assist fleet managers in the organization, archival, and management of videos and telematics information; miniature body-worn digital video systems for law enforcement and private security; and VuLink, an in-car device that enables an in-car digital audio/video system and a body worn digital audio/video camera system to automatically and simultaneously start recording. It also provides VuVault and EVO Web, a cloud-based evidence management system; FleetVU Manager, a web-based software for commercial fleet tracking and monitoring; ThermoVu, a non-contact temperature-screening instrument that measures temperature through the wrist and controls entry to facilities when temperature measurements exceed pre-determined parameters; and Shield disinfectants and cleansers, as well as other personal protective equipment and supplies, such as masks, gloves, sanitizer wipes, and electrostatic sprayer to health care workers and other consumers. In addition, the company offers working capital and back-office services, including insurance and benefit verification, medical treatment documentation and coding, and collections to healthcare organizations; and operates TicketSmarter.com, an online ticketing marketplace for ticket sales, partnerships, and ticket resale services for live events, including concerts, sporting events, theatres, and performing arts. Digital Ally, Inc. was founded in 2004 and is headquartered in Lenexa, Kansas.
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