Contrasting Fabrinet (FN) & Westell Technologies (WSTL)

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Fabrinet (NASDAQ: WSTL) and Westell Technologies (NASDAQ:WSTL) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, profitability, analyst recommendations, institutional ownership, earnings, valuation and dividends.

Analyst Ratings

This is a summary of current ratings and recommmendations for Fabrinet and Westell Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fabrinet 0 2 3 1 2.83
Westell Technologies 0 0 0 0 N/A

Fabrinet presently has a consensus price target of $42.67, suggesting a potential downside of 3.03%. Given Fabrinet’s higher probable upside, equities analysts clearly believe Fabrinet is more favorable than Westell Technologies.

Institutional and Insider Ownership

97.7% of Fabrinet shares are owned by institutional investors. Comparatively, 24.7% of Westell Technologies shares are owned by institutional investors. 3.3% of Fabrinet shares are owned by company insiders. Comparatively, 25.6% of Westell Technologies shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Fabrinet has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, Westell Technologies has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.

Profitability

This table compares Fabrinet and Westell Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fabrinet 6.36% 12.48% 8.52%
Westell Technologies 1.02% 7.09% 6.08%

Valuation & Earnings

This table compares Fabrinet and Westell Technologies’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fabrinet $1.42 billion 1.14 $97.11 million $2.57 17.12
Westell Technologies $58.58 million 0.69 $30,000.00 $0.20 12.90

Fabrinet has higher revenue and earnings than Westell Technologies. Westell Technologies 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 Westell Technologies on 12 of the 14 factors compared between the two stocks.

Fabrinet Company Profile

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

Westell Technologies Company Profile

Westell Technologies, Inc., through its subsidiary, Westell, Inc., designs and distributes telecommunications products to telephone companies in the United States. The company operates through three segments: In-Building Wireless (IBW), Intelligent Site Management and Services (ISMS), and Communications Network Solutions (CNS). The IBW segment offers distributed antenna system conditioners; repeaters; battery backup units; and system components and antennas, including couplers, duplexers, splitters, filters, and tappers for commercial and public safety in-building wireless systems. The ISMS segment provides a suite of remote units, which provide machine-to-machine communications that enable operators to remotely monitor, manage, and control site infrastructure and support systems. The CNS segment provides a range of outdoor network infrastructure, such as integrated cabinets, power distribution products, copper and fiber connectivity panels, T1 network interface units, and tower mounted amplifiers. The company serves wireless and wireline service providers, multiple systems operators, Internet service providers, systems integrators, neutral host operators, and distributors through field sales organization, distributors, and partners. Westell Technologies, Inc. was founded in 1980 and is headquartered in Aurora, Illinois.

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