Palo Alto Networks (NYSE:PANW) and TESSCO Technologies (NASDAQ:TESS) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, valuation, risk, earnings, profitability, institutional ownership and analyst recommendations.
Valuation and Earnings
This table compares Palo Alto Networks and TESSCO Technologies' top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Palo Alto Networks | $3.41 billion | 10.43 | $-267,000,000.00 | ($1.24) | -294.96 |
| TESSCO Technologies | $540.30 million | 0.13 | $-21,570,000.00 | ($1.10) | -6.98 |
TESSCO Technologies has lower revenue, but higher earnings than Palo Alto Networks. Palo Alto Networks is trading at a lower price-to-earnings ratio than TESSCO Technologies, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Palo Alto Networks and TESSCO Technologies' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Palo Alto Networks | -8.36% | -8.66% | -1.16% |
| TESSCO Technologies | -4.73% | -11.16% | -4.44% |
Analyst Ratings
This is a summary of current ratings for Palo Alto Networks and TESSCO Technologies, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Palo Alto Networks | 1 | 2 | 28 | 0 | 2.87 |
| TESSCO Technologies | 0 | 0 | 0 | 0 | N/A |
Palo Alto Networks presently has a consensus target price of $381.3030, suggesting a potential upside of 4.07%. Given Palo Alto Networks' higher possible upside, equities research analysts plainly believe Palo Alto Networks is more favorable than TESSCO Technologies.
Risk & Volatility
Palo Alto Networks has a beta of 1.5, indicating that its share price is 50% more volatile than the S&P 500. Comparatively, TESSCO Technologies has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500.
Institutional and Insider Ownership
80.8% of Palo Alto Networks shares are owned by institutional investors. Comparatively, 49.0% of TESSCO Technologies shares are owned by institutional investors. 2.3% of Palo Alto Networks shares are owned by company insiders. Comparatively, 30.0% of TESSCO Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Summary
Palo Alto Networks beats TESSCO Technologies on 8 of the 13 factors compared between the two stocks.
