Frequency Electronics (NASDAQ:FEIM – Get Free Report) and Electro-Sensors (NASDAQ:ELSE – Get Free Report) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, risk, earnings, dividends, valuation, profitability and analyst recommendations.
Insider & Institutional Ownership
58.6% of Frequency Electronics shares are held by institutional investors. Comparatively, 11.7% of Electro-Sensors shares are held by institutional investors. 28.0% of Frequency Electronics shares are held by insiders. Comparatively, 13.3% of Electro-Sensors shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Profitability
This table compares Frequency Electronics and Electro-Sensors’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Frequency Electronics | 10.78% | 12.69% | 7.84% |
| Electro-Sensors | 3.02% | 2.10% | 1.98% |
Volatility and Risk
Analyst Recommendations
This is a summary of current ratings and recommmendations for Frequency Electronics and Electro-Sensors, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Frequency Electronics | 0 | 1 | 1 | 1 | 3.00 |
| Electro-Sensors | 0 | 1 | 0 | 0 | 2.00 |
Frequency Electronics presently has a consensus target price of $43.67, suggesting a potential downside of 26.44%. Given Frequency Electronics’ stronger consensus rating and higher possible upside, equities analysts clearly believe Frequency Electronics is more favorable than Electro-Sensors.
Valuation and Earnings
This table compares Frequency Electronics and Electro-Sensors”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Frequency Electronics | $69.81 million | 8.37 | $23.69 million | $0.75 | 79.15 |
| Electro-Sensors | $10.14 million | 2.66 | $310,000.00 | $0.09 | 84.94 |
Frequency Electronics has higher revenue and earnings than Electro-Sensors. Frequency Electronics is trading at a lower price-to-earnings ratio than Electro-Sensors, indicating that it is currently the more affordable of the two stocks.
Summary
Frequency Electronics beats Electro-Sensors on 13 of the 15 factors compared between the two stocks.
About Frequency Electronics
Frequency Electronics, Inc., together with its subsidiaries, engages in designing, development, and manufacturing of precision time and frequency control products and components for microwave integrated circuit applications. It operates through two segments, FEI-NY and FEI-Zyfer. The FEI-NY segment offers precision time and frequency control products for communication satellites, terrestrial cellular telephone or other ground-based telecommunication stations; and other components and systems for the U.S. military; and provides design and technical support for satellite business. FEI-Zyfer segment offers global positioning system technologies to systems and subsystems for secure communications, both government and commercial, and other locator applications; and engages in sale and support of wireline telecommunications products, including US5G. It markets its products directly and through independent sales representative organizations located in the United States, Europe, and Asia. Frequency Electronics, Inc. was founded in 1961 and is headquartered in Mitchel Field, New York.
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.
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