LightPath Technologies (NASDAQ:LPTH) and Surge Component (OTCMKTS:SPRS) Critical Contrast

LightPath Technologies (NASDAQ:LPTH) and Surge Component (OTCMKTS:SPRS) are both small-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, profitability, valuation and institutional ownership.

Volatility and Risk

LightPath Technologies has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500. Comparatively, Surge Component has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500.

Profitability

This table compares LightPath Technologies and Surge Component’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
LightPath Technologies	-39.92%	-53.40%	-18.17%
Surge Component	2.56%	4.49%	3.47%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for LightPath Technologies and Surge Component, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LightPath Technologies	1	1	4	0	2.50
Surge Component	0	0	0	0	0.00

LightPath Technologies presently has a consensus target price of $6.50, suggesting a potential downside of 23.08%. Given LightPath Technologies’ stronger consensus rating and higher probable upside, equities analysts plainly believe LightPath Technologies is more favorable than Surge Component.

Insider & Institutional Ownership

56.3% of LightPath Technologies shares are owned by institutional investors. 14.7% of LightPath Technologies shares are owned by company insiders. Comparatively, 53.0% of Surge Component shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares LightPath Technologies and Surge Component”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LightPath Technologies	$37.20 million	10.15	-$14.87 million	($0.36)	-23.47
Surge Component	$31.21 million	0.51	$830,000.00	$0.15	18.17

Surge Component has lower revenue, but higher earnings than LightPath Technologies. LightPath Technologies is trading at a lower price-to-earnings ratio than Surge Component, indicating that it is currently the more affordable of the two stocks.

About LightPath Technologies

LightPath Technologies, Inc. designs, develops, manufactures, and distributes optical components and assemblies. The company offers precision molded glass aspheric optics, molded and diamond-turned infrared aspheric lenses, and other optical components used to produce products that manipulate light; and infrared products, including catalog and custom infrared optics. Its products are used in defense products, medical devices, laser aided industrial tools, automotive safety applications, barcode scanners, optical data storage, hybrid fiber coax datacom, telecommunications, machine vision and sensors, and other sectors. The company sells its products directly to customers in Europe and Asia. LightPath Technologies, Inc. was founded in 1985 and is headquartered in Orlando, Florida.

About Surge Component

Surge Components, Inc., together with its subsidiaries, supplies electronic products and components. It offers capacitors, which are electrical energy storage devices; and discrete semiconductor components, such as rectifiers, transistors, diodes, circuit protection devices, and audible components comprising audible transducers, Piezo buzzers, speakers, and microphones. The company also provides resonators, alarms, chimes, filters, and discriminators, as well as fuses, printed circuit boards, and switches. Its products are used in the electronic circuitry of various industries, including automotive, computer, communications, cellular telephones, consumer electronics, garage door openers, security equipment, audio equipment, telecom products, computer related products, power supply products, utility meters, and household appliances. The company sells its products to original equipment manufacturers and distributors through independent sales representatives or organizations in Canada, China, other Asian countries, South America, and Europe. Surge Components, Inc. was incorporated in 1981 and is headquartered in Deer Park, New York.