Analyzing NVE (NASDAQ:NVEC) & Sequans Communications (NASDAQ:SQNS)

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NVE (NASDAQ:NVEC) and Sequans Communications (NYSE:SQNS) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, profitability, risk and earnings.

Institutional and Insider Ownership

74.4% of NVE shares are held by institutional investors. Comparatively, 30.6% of Sequans Communications shares are held by institutional investors. 2.3% of NVE shares are held by insiders. Comparatively, 9.4% of Sequans Communications shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and target prices for NVE and Sequans Communications, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NVE 0 0 0 0 N/A
Sequans Communications 0 0 5 0 3.00

Sequans Communications has a consensus price target of $2.23, indicating a potential upside of 199.87%. Given Sequans Communications’ higher possible upside, analysts plainly believe Sequans Communications is more favorable than NVE.

Earnings and Valuation

This table compares NVE and Sequans Communications’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NVE $26.47 million 11.70 $14.51 million N/A N/A
Sequans Communications $40.25 million 1.75 -$36.22 million ($0.36) -2.06

NVE has higher earnings, but lower revenue than Sequans Communications.

Volatility and Risk

NVE has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500. Comparatively, Sequans Communications has a beta of 2.64, meaning that its share price is 164% more volatile than the S&P 500.

Profitability

This table compares NVE and Sequans Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NVE 55.22% 16.97% 16.78%
Sequans Communications -120.67% -5,057.55% -55.96%

Dividends

NVE pays an annual dividend of $4.00 per share and has a dividend yield of 6.3%. Sequans Communications does not pay a dividend.

Summary

NVE beats Sequans Communications on 8 of the 13 factors compared between the two stocks.

About NVE

NVE Corporation develops and sells devices that use spintronics, a nanotechnology that utilizes electron spin to acquire, store, and transmit information. The company manufactures spintronic products, including sensors and couplers for use in acquiring and transmitting data. Its products comprise standard sensors to detect the presence of a magnetic or metallic material to determine position or speed primarily for the factory automation market; and custom and medical sensors for medical devices to replace electromechanical magnetic switches. The company also offers spintronic couplers, such as IL500-series couplers, IL600-series passive-input couplers, IL700/IL200-series high-speed couplers, IL4/IL3-series isolated network couplers, and IL800-series top-of-the-line couplers. In addition, it licenses the spintronic magnetoresistive random access memory technology, as well as conducts contract research and development activities. The company sells its products through distributors in the United States, Europe, the Middle East, Africa, Asia-Pacific, and internationally. NVE Corporation was founded in 1989 and is headquartered in Eden Prairie, Minnesota.

About Sequans Communications

Sequans Communications S.A., together with its subsidiaries, engages in fabless designing, developing, and supplying 4G LTE semiconductor solutions for wireless broadband and Internet of Things applications. Its solutions incorporate baseband processor and radio frequency (RF) transceiver integrated circuits along with proprietary signal processing techniques, algorithms, and software stacks. The company offers baseband solutions used to encode and decode data based on 4G protocols that serve as the wireless processing platform for a 4G device; RF transceivers used to transmit and receive wireless transmissions; and system-on-chip solutions that integrate the baseband and RF transceiver functions. Its solutions serves as the wireless communications platform in various devices, including USB dongles; portable routers; embedded wireless modems for computing and multimedia devices; and customer-premises equipment, such as fixed wireless broadband access modems, routers, and residential gateways. The company's solutions also provide connectivity for industrial devices in transportation, security, asset tracking, retail, smart energy, smart city, agriculture, healthcare, and other applications. It serves OEMs, ODMs, contract manufacturers, or system integrators, as well as distributors who provide customer communications, logistics, and support functions. The company operates in the Asia-Pacific region, including Taiwan, China, South Korea, and Japan; Europe; the Middle East; and North and South America. Sequans Communications S.A. was founded in 2003 and is headquartered in Paris, France.

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