Radware (NASDAQ:RDWR) and Steel Connect (NASDAQ:STCN) 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 analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.
Risk and Volatility
Radware has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500. Comparatively, Steel Connect has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500.
This table compares Radware and Steel Connect’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Radware||$252.07 million||4.75||$22.57 million||$0.57||44.82|
|Steel Connect||$819.83 million||0.04||-$66.73 million||N/A||N/A|
Radware has higher earnings, but lower revenue than Steel Connect.
This is a summary of recent ratings and recommmendations for Radware and Steel Connect, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Radware currently has a consensus price target of $26.50, indicating a potential upside of 3.72%. Given Radware’s higher probable upside, analysts clearly believe Radware is more favorable than Steel Connect.
This table compares Radware and Steel Connect’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
71.5% of Radware shares are held by institutional investors. Comparatively, 50.4% of Steel Connect shares are held by institutional investors. 21.6% of Radware shares are held by company insiders. Comparatively, 11.4% of Steel Connect shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Radware beats Steel Connect on 11 of the 12 factors compared between the two stocks.
Radware Ltd. develops, manufactures, and markets cyber security and application delivery solutions for applications in physical, virtual, cloud, and software defined data centers worldwide. The company offers DefensePro, a real-time network attack prevention device; AppWall, a Web application firewall; and DefenseFlow, a cyber-command and control application. It also provides Alteon D Line, an application delivery controller/load balancer for Web, cloud, and mobile based applications; and LinkProof NG, a multi-homing and enterprise gateway solution for connectivity of enterprise and cloud-based applications. In addition, the company offers Security Updates Subscription, which provides security updates to protect customers against the latest threats; ERT Active Attackers Feed that provides customers with information pertaining to attack sources recently involved in DDoS attacks; Alteon Global Elastic License that captures application lifecycle for large ADC deployments; APSolute Vision, a management and monitoring tool for company's application delivery and cyber security solutions; and MSSP Portal, a DDoS detection and mitigation service portal. Further, it provides Cloud DDoS Protection Service, which offers a range of enterprise-grade DDoS protection services in the cloud, as well as technical support, professional, managed, and training and certification services to its customers. The company sells its products primarily to independent distributors, including value added resellers, original equipment manufacturers, and system integrators. Radware Ltd. was founded in 1996 and is headquartered in Tel Aviv, Israel.
About Steel Connect
Steel Connect, Inc., through its subsidiaries, provides supply chain and logistics services to the consumer electronics, communications, computing, medical devices, software, storage, retail, and other industries. It operates through five segments: Americas, Asia, Europe, Direct Marketing, and e-Business. The company offers product configuration and packaging, kitting, and assembly of components and parts into finished goods; and value-added processes, such as product testing, radio frequency identification (RFID) tagging, product or service activation, language settings, personalization and engraving, multi-channel packaging, and packaging design services. It also provides fulfillment services, including order management, pick, pack and ship, retail compliance, and demand planning services; and content protection and activation, and IP security services, as well as optimizes component and finished goods inventory levels. In addition, it offers operates a cloud-based e-commerce platform, which online buying experience so that products can be purchased, serviced, and delivered worldwide; and provides reverse logistics services that simplifies the returns process for retailers and manufacturers to improve service parts management and the value of returned assets. Further, the company offers EZ Connect service, which provides essential fulfillment capabilities for emerging growth companies without the expensive surprises associated with third-party fulfillment services; and direct marketing services comprising end-to-end services for paper-based direct marketing and omnichannel marketing campaign services. The company was formerly known as ModusLink Global Solutions, Inc. and changed its name to Steel Connect, Inc. in February 2018. Steel Connect, Inc. was incorporated in 1986 and is headquartered in Waltham, Massachusetts.
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