Financial Analysis: A10 Networks (ATEN) and The Competition

A10 Networks (NYSE:ATEN) is one of 959 publicly-traded companies in the “Software” industry, but how does it weigh in compared to its competitors? We will compare A10 Networks to related companies based on the strength of its earnings, risk, dividends, valuation, institutional ownership, profitability and analyst recommendations.

Insider & Institutional Ownership

98.6% of A10 Networks shares are owned by institutional investors. Comparatively, 41.5% of shares of all “Software” companies are owned by institutional investors. 1.2% of A10 Networks shares are owned by insiders. Comparatively, 19.9% of shares of all “Software” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

A10 Networks has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500. Comparatively, A10 Networks’ competitors have a beta of 1.35, meaning that their average stock price is 35% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for A10 Networks and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
A10 Networks	0	5	2	0	2.29
A10 Networks Competitors	5842	21623	45021	1501	2.57

A10 Networks currently has a consensus target price of $30.38, indicating a potential upside of 6.22%. As a group, “Software” companies have a potential upside of 28.69%. Given A10 Networks’ competitors stronger consensus rating and higher probable upside, analysts plainly believe A10 Networks has less favorable growth aspects than its competitors.

Earnings & Valuation

This table compares A10 Networks and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
A10 Networks	$290.56 million	$42.14 million	43.33
A10 Networks Competitors	$1.79 billion	$382.69 million	111.80

A10 Networks’ competitors have higher revenue and earnings than A10 Networks. A10 Networks is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Dividends

A10 Networks pays an annual dividend of $0.24 per share and has a dividend yield of 0.8%. A10 Networks pays out 36.4% of its earnings in the form of a dividend. As a group, “Software” companies pay a dividend yield of 1.9% and pay out 47.3% of their earnings in the form of a dividend.

Profitability

This table compares A10 Networks and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
A10 Networks	14.66%	25.35%	8.79%
A10 Networks Competitors	-596.15%	26.13%	-8.98%

Summary

A10 Networks competitors beat A10 Networks on 11 of the 15 factors compared.

About A10 Networks

A10 Networks, Inc. provides application delivery and cybersecurity solutions for enterprises, service providers and cloud providers. Its products are designed to help organizations maintain the availability, performance and security of applications and network services. The company’s portfolio includes application delivery controllers, distributed denial-of-service (DDoS) protection, network firewalls, and tools for encrypted-traffic visibility and management. These solutions are offered as physical appliances, software and cloud-based services.