Contrasting Viavi Solutions (NASDAQ:VIAV) and NetScout Systems (NASDAQ:NTCT)

Viavi Solutions (NASDAQ:VIAV) and NetScout Systems (NASDAQ:NTCT) are both mid-cap technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Viavi Solutions and NetScout Systems, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Viavi Solutions	1	1	6	1	2.78
NetScout Systems	0	2	0	1	2.67

Viavi Solutions presently has a consensus target price of $55.43, indicating a potential upside of 47.46%. NetScout Systems has a consensus target price of $38.00, indicating a potential upside of 1.58%. Given Viavi Solutions’ stronger consensus rating and higher possible upside, equities analysts clearly believe Viavi Solutions is more favorable than NetScout Systems.

Institutional and Insider Ownership

95.5% of Viavi Solutions shares are owned by institutional investors. Comparatively, 91.6% of NetScout Systems shares are owned by institutional investors. 1.8% of Viavi Solutions shares are owned by insiders. Comparatively, 4.7% of NetScout Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

Viavi Solutions has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, NetScout Systems has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500.

Profitability

This table compares Viavi Solutions and NetScout Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Viavi Solutions	-2.00%	19.60%	7.48%
NetScout Systems	13.71%	9.25%	6.59%

Earnings & Valuation

This table compares Viavi Solutions and NetScout Systems”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Viavi Solutions	$1.52 billion	6.11	-$30.40 million	($0.15)	-250.60
NetScout Systems	$859.48 million	3.16	$95.53 million	$1.64	22.81

NetScout Systems has lower revenue, but higher earnings than Viavi Solutions. Viavi Solutions is trading at a lower price-to-earnings ratio than NetScout Systems, indicating that it is currently the more affordable of the two stocks.

Summary

Viavi Solutions beats NetScout Systems on 9 of the 14 factors compared between the two stocks.

About Viavi Solutions

Viavi Solutions, Inc. engages in the provision of network test, monitoring, and assurance solutions for communications service providers, enterprises, network equipment manufacturers, government and avionics. It operates through the following segments: Network Enablement, Service Enablement, and Optical Security and Performance. The Network Enablement segment offers an integrated portfolio of testing solutions that access the network to perform build-out and maintenance tasks. The Service Enablement segment covers solutions and services primarily for communication service providers, and enterprises that deliver and/or operate broadband and IP networks (fixed and mobile) supporting voice, video, and data services as well as a wide range of applications. The Optical Security and Performance segment leverages its core optical coating technologies and volume manufacturing capability to design, manufacture, and sell products targeting anti-counterfeiting, consumer and industrial, government, healthcare, and other markets. The company was founded in 1979 and is headquartered in Chandler, AZ.

About NetScout Systems

NetScout Systems, Inc. provides service assurance and cybersecurity solutions for protect digital business services against disruptions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that enables customers to predict, preempt, and resolve network and service delivery problems, as well as facilitate the optimization and capacity planning of their network infrastructures; and specialized platforms and analytic modules that enable its customers to analyze and troubleshoot traffic in radio access and Wi-Fi networks. It also provides nGeniusPULSE, an active testing tool that enables enterprises to identify infrastructure performance issues and determine application availability, reliability, and performance; and nGenius Business Analytics solution, which enables service providers to analyze their network traffic. In addition, the company offers ISNG, an advanced passive network probe; packet flow systems that deliver targeted network traffic access to various monitoring and security tools and systems; and a suite of test access points that enable non-disruptive access to network traffic. Further, it provides cybersecurity solutions to protect their networks against distributed denial of service attacks under the Arbor brand, such as Arbor Sightline, Arbor Threat Mitigation System, Arbor Insight, Arbor Edge Defense, and Arbor Cloud. Additionally, the company offers advanced threat detection solutions, such as Omnis Cyber Investigator. It serves enterprise customers in various industries, including financial services, technology, manufacturing, healthcare, utilities, education, transportation, and retail; mobile operators, wireline operators, cable operators, Internet service providers, and cloud providers; and governmental agencies through a direct sales force, and indirect reseller and distribution channels. The company was incorporated in 1984 and is headquartered in Westford, Massachusetts.