Analyzing F5 (NASDAQ:FFIV) & ZTE (OTCMKTS:ZTCOY)

ZTE (OTCMKTS:ZTCOY) and F5 (NASDAQ:FFIV) are both technology companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.

Profitability

This table compares ZTE and F5’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ZTE	5.89%	13.25%	4.04%
F5	21.95%	21.54%	12.16%

Insider and Institutional Ownership

90.7% of F5 shares are held by institutional investors. 0.5% of F5 shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares ZTE and F5″s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ZTE	$17.75 billion	0.53	$1.06 billion	$0.47	8.60
F5	$3.09 billion	6.95	$692.38 million	$12.56	30.18

ZTE has higher revenue and earnings than F5. ZTE is trading at a lower price-to-earnings ratio than F5, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

ZTE has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500. Comparatively, F5 has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for ZTE and F5, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ZTE	0	0	0	0	0.00
F5	1	5	5	0	2.36

F5 has a consensus price target of $416.62, suggesting a potential upside of 9.92%. Given F5’s stronger consensus rating and higher possible upside, analysts clearly believe F5 is more favorable than ZTE.

Summary

F5 beats ZTE on 12 of the 14 factors compared between the two stocks.

About ZTE

ZTE Corporation provides integrated communication information solutions in the People's Republic of China, rest of Asia, Africa, Europe, the United States, and Oceania. It operates through three segments: Carriers' Networks, Government and Corporate Business, and Consumer Business. The Carriers' Network segment provides wireless access, wireline access, bearer systems, core networks, telecommunication software systems and services, and other technologies and product solutions for meeting carries' requirements. The Consumer Business segment offers smart phones, mobile data terminals, family terminals, and fusion terminals, as well as related software application and value-added services. The Government and Corporate Business segment focuses on providing informatization solutions for the government and corporations through the application of products, such as communications networks, Internet of Things, big data, and cloud computing. The company was founded in 1985 and is headquartered in Shenzhen, the People's Republic of China.

About F5

F5, Inc. provides multi-cloud application security and delivery solutions in the United States, Europe, the Middle East, Africa, and the Asia Pacific region. The company’s distributed cloud services enable its customers to deploy, secure, and operate applications in any architecture, from on-premises to the public cloud. It offers unified, security, networking, and application management solutions, such as web app and API protection; multi-cloud networking; application delivery and deployment; domain name system; content delivery network; and application deployment and orchestration. The company also provides application security and delivery products, including NGINX Plus; NGINX Management Suite; NGINX Ingress Controller; NGINX App Protect; BIG-IP Packaged Software; and BIG-IP Systems. In addition, it provides a range of professional services, including maintenance, consulting, training, and other technical support services. F5, Inc. sells its products to large enterprise businesses, public sector institutions, governments, and service providers through distributors, value-added resellers, managed service providers, systems integrators, and other indirect channel partners. It has partnerships with public cloud providers, such as Amazon Web Services, Microsoft Azure, and Google Cloud Platform. The company was formerly known as F5 Networks, Inc. and changed its name to F5, Inc. in November 2021. F5, Inc. was incorporated in 1996 and is headquartered in Seattle, Washington.