Financial Analysis: Daktronics (DAKT) and Identiv (INVE)

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

Profitability

This table compares Identiv and Daktronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Identiv -6.02% -10.62% -4.94%
Daktronics 1.04% 3.01% 1.65%



Valuation and Earnings

This table compares Identiv and Daktronics’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Identiv $78.14 million 1.19 -$4.71 million ($0.30) -18.87
Daktronics $610.53 million 0.55 $5.56 million $0.22 34.18

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

Institutional and Insider Ownership

31.4% of Identiv shares are held by institutional investors. Comparatively, 58.5% of Daktronics shares are held by institutional investors. 10.5% of Identiv shares are held by company insiders. Comparatively, 8.2% of Daktronics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Identiv has a beta of 1.85, meaning that its stock price is 85% more volatile than the S&P 500. Comparatively, Daktronics has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500.

Dividends

Daktronics pays an annual dividend of $0.28 per share and has a dividend yield of 3.7%. Identiv does not pay a dividend. Daktronics pays out 127.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Identiv and Daktronics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Identiv 0 0 4 0 3.00
Daktronics 0 0 1 0 3.00

Identiv presently has a consensus target price of $9.00, indicating a potential upside of 59.01%. Daktronics has a consensus target price of $10.00, indicating a potential upside of 32.98%. Given Identiv’s higher possible upside, research analysts clearly believe Identiv is more favorable than Daktronics.

Summary

Daktronics beats Identiv on 9 of the 15 factors compared between the two stocks.

Identiv Company Profile

Identiv, Inc. operates as a security technology company that secures and manages access to physical places, things, and information primarily in the Americas, Europe, the Middle-East, and the Asia-Pacific. Its Premises segment offers modular Hirsch MX controllers that allow customers to start with a small system and expand over time; Hirsch Velocity software platform for centralized management of access and security operations across an organization; federal identity, credential and acess management architecture, an access control system; TouchSecure door readers that provide various features to support security standards; and global services to support system design, deployment, and managed services across customers premises security lifecycle. Its Identity segment provides smart card readers, which include various contact, contactless, portable, and mobile smart card readers, as well as tokens and terminals to enable logical access, and security and identification applications, such as national ID, payment, e-health, and e-government. Its Credentials segment provides NFC and radio frequency identification products, including inlays and inlay-based, and other cards; and labels, tags, and stickers, as well as other radio frequency and integrated circuits components for use in various applications, such as virtual reality, games, loyalty cards, mobile payment systems, transit and event ticketing, and brand authenticity from pharmaceuticals to consumer goods, hospital resource management, cold-chain management, and others. Its All Other segment provides chip drives and digital media readers. Identiv, Inc. markets and sells its products through original equipment manufacturers, dealers, systems integrators, value added resellers, resellers, and Internet, as well as directly to end users. The company was formerly known as Identive Group, Inc. and changed its name to Identiv, Inc. in May 2014. Identiv, Inc. was founded in 1990 and is headquartered in Fremont, California.

Daktronics Company Profile

Daktronics, Inc. designs, manufactures, and sells a range of electronic display systems and related products worldwide. It operates through five segments: Commercial, Live Events, High School Park and Recreation, Transportation, and International. The company offers video display systems, such as displays to show various levels of video, graphics, and animation; LED ribbon board displays; mobile and modular display systems; freeform LED displays, which include architectural lighting and display products; indoor and outdoor scoreboards for various sports, digit displays, scoring and timing controllers, statistics software, and other related products; and timing systems for sports events primarily aquatics and track competitions, as well as swimming touchpads, race start systems, and relay take-off platforms. It also provides message displays; ITS dynamic message signs, including LED displays for road management, mass transit, and aviation applications; digit and directional displays for use in parking facilities; and audio systems for outdoor sports venues. In addition, the company offers digital billboards and street furniture displays used to display images, which change at regular intervals for the out-of-home (OOH) advertising industry comprising Visiconn system and Venus Control Suite, a software application for controlling content and playback loops for digital billboard applications; and street furniture for digital OOH campaigns. Further, it provides digit and price displays, such as outdoor time and temperature displays, as well as Fuelight digit displays for the petroleum industry; and dynamic messaging systems for retailers, convenience stores, and other businesses, as well as maintenance and professional services related to its products. The company sells its products through direct sales and resellers. Daktronics, Inc. was founded in 1968 and is based in Brookings, South Dakota.

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