ScanSource (NASDAQ: SCSC) and Quantum Corporation (NYSE:QTM) are both small-cap industrial products companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitabiliy and analyst recommendations.
This is a breakdown of current ratings for ScanSource and Quantum Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
ScanSource currently has a consensus price target of $45.25, suggesting a potential upside of 17.38%. Quantum Corporation has a consensus price target of $1.50, suggesting a potential downside of 79.25%. Given ScanSource’s higher probable upside, equities analysts plainly believe ScanSource is more favorable than Quantum Corporation.
Earnings and Valuation
This table compares ScanSource and Quantum Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|ScanSource||$3.53 billion||0.28||$109.04 million||$2.48||15.54|
|Quantum Corporation||$505.35 million||0.49||$19.64 million||$0.10||72.31|
ScanSource has higher revenue and earnings than Quantum Corporation. ScanSource is trading at a lower price-to-earnings ratio than Quantum Corporation, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
94.7% of ScanSource shares are held by institutional investors. 3.0% of ScanSource shares are held by company insiders. Comparatively, 8.2% of Quantum Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
This table compares ScanSource and Quantum Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
ScanSource has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500. Comparatively, Quantum Corporation has a beta of 2.3, indicating that its share price is 130% more volatile than the S&P 500.
ScanSource beats Quantum Corporation on 8 of the 13 factors compared between the two stocks.
ScanSource, Inc. is a provider of technology products and solutions. The Company and its subsidiaries provide solutions for technology manufacturers and sell to resellers in technology markets, such as point-of-sale (POS) and Barcode, Networking and Security, Communications and Emerging Technologies. It operates through two segments: Worldwide Barcode & Security and Worldwide Communications & Services. The Barcode & Security distribution segment focuses on automatic identification and data capture (AIDC), POS, electronic physical security and three dimensional (3D) printing technologies. The Communications & Services distribution segment focuses on communications technologies and services. As of June 30, 2016, the Company marketed over 100,000 products from approximately 400 hardware and software vendors to approximately 35,000 reseller customers from distribution centers in Mississippi, Virginia, Florida, Mexico, Colombia, Brazil, Belgium, France, Germany and the United Kingdom.
About Quantum Corporation
Quantum Corporation focuses on scale-out storage, archive and data protection, providing solutions for capturing, sharing, managing and preserving digital assets over the entire data lifecycle. The Company’s end-to-end tiered storage solutions enable users to maximize the value of their data by making it accessible whenever and wherever needed, retaining it indefinitely and reducing total cost and complexity. It works with a network of distributors, value-added resellers (VARs), direct marketing resellers (DMRs), original equipment manufacturers (OEMs) and other suppliers to meet customers’ evolving needs. Its scale-out storage portfolio includes StorNext software, appliances and full systems called StorNext Pro Solutions, as well as Xcellis workflow storage, QXS disk storage, Lattus extended online storage and Q-Cloud Archive and Vault services. Its StorNext offerings enable customers to manage large unstructured data sets in an information workflow.
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