Financial Analysis: RF Industries (NASDAQ:RFIL) & Interlink Electronics (NASDAQ:LINK)

Interlink Electronics (NASDAQ:LINK) and RF Industries (NASDAQ:RFIL) are both small-cap technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Profitability

This table compares Interlink Electronics and RF Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Interlink Electronics	-8.95%	-12.38%	-9.81%
RF Industries	1.70%	12.79%	6.32%

Insider and Institutional Ownership

23.5% of RF Industries shares are held by institutional investors. 77.5% of Interlink Electronics shares are held by insiders. Comparatively, 20.4% of RF Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Interlink Electronics and RF Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Interlink Electronics	$11.89 million	6.66	-$1.62 million	($0.07)	-71.86
RF Industries	$80.59 million	1.40	$80,000.00	$0.14	74.29

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Interlink Electronics and RF Industries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Interlink Electronics	1	0	1	0	2.00
RF Industries	0	2	2	0	2.50

Interlink Electronics presently has a consensus price target of $8.67, suggesting a potential upside of 72.30%. RF Industries has a consensus price target of $17.00, suggesting a potential upside of 63.46%. Given Interlink Electronics’ higher probable upside, equities analysts plainly believe Interlink Electronics is more favorable than RF Industries.

Summary

RF Industries beats Interlink Electronics on 10 of the 13 factors compared between the two stocks.

About Interlink Electronics

Interlink Electronics, Inc., together with its subsidiaries, designs, develops, manufactures, and sells force-sensing technologies that incorporate proprietary materials technology, firmware, and software into sensor-based products and custom sensor system solutions in the United States, Asia, the Middle East, Europe, and internationally. The company's products include sensor components, subassemblies, modules, and products that support cursor control and novel three-dimensional user inputs. It also provides simple force and piezo sensors to multi-finger capable rugged trackpads; Force-Sensing Resistor sensors; force sensing linear potentiometers for menu navigation and control; and integrated mouse modules and pointing solutions to various electronic devices. In addition, the company offers human machine interface technology platforms for various applications, including vehicle entry, vehicle multi-media control interface, rugged touch controls, presence detection, collision detection, speed and torque controls, pressure mapping, biological monitoring, and others; and embedded firmware development and integration support services. It serves multi-national and start-up companies, technology design houses, original design manufacturers, original equipment manufacturers, and universities in various markets, such as consumer electronics, automotive, industrial, and medical through direct sales employees, as well as outside sales representatives and distributors. Interlink Electronics, Inc. was incorporated in 1985 and is headquartered in Irvine, California.

About RF Industries

RF Industries, Ltd., together with its subsidiaries, designs, manufactures, and markets interconnect products and systems in the United States, Canada, Italy, Mexico, and internationally. The company operates through two segments, RF Connector and Cable Assembly, and Custom Cabling Manufacturing and Assembly. The company designs, manufactures, and distributes various coaxial connectors and cable assemblies that are integrated with coaxial connectors; custom copper and fiber cable assemblies, complex hybrid fiber optic and power solution cables, adapters, and electromechanical wiring harnesses for communication, computer, LAN, automotive, and medical equipment; energy-efficient cooling systems for wireless base stations and remote equipment shelters; and custom-designed pole-ready 5G small cell integrated enclosures. It also designs and manufactures cable assemblies and wiring harnesses for blue chip industrial, oilfield, instrumentation, medical, and military customers; connectivity solutions to telecommunications and data communications distributors; thermal control systems; and radio frequency and microwave distribution system products, such as dividers, directional couplers, and filters. The company sells its products through warehousing distributors and in-house marketing and sales team. It serves telecommunications carriers and equipment manufacturers, wireless and network infrastructure carriers, and original equipment manufacturers. The company was formerly known as Celltronics, Inc. and changed its name RF Industries, Ltd. in November 1990. RF Industries, Ltd. was incorporated in 1979 and is headquartered in San Diego, California.