CSP (NASDAQ:CSPI) and Digimarc (NASDAQ:DMRC) are both small-cap computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.
CSP pays an annual dividend of $0.60 per share and has a dividend yield of 4.1%. Digimarc does not pay a dividend. CSP has increased its dividend for 6 consecutive years.
24.7% of CSP shares are held by institutional investors. Comparatively, 60.1% of Digimarc shares are held by institutional investors. 10.1% of CSP shares are held by insiders. Comparatively, 6.4% of Digimarc shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Earnings and Valuation
This table compares CSP and Digimarc’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|CSP||$72.92 million||0.82||$14.44 million||N/A||N/A|
|Digimarc||$21.19 million||29.60||-$32.51 million||($2.86)||-18.08|
CSP has higher revenue and earnings than Digimarc.
Risk and Volatility
CSP has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Digimarc has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.
This table compares CSP and Digimarc’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and price targets for CSP and Digimarc, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Digimarc has a consensus target price of $52.38, suggesting a potential upside of 1.27%. Given Digimarc’s higher probable upside, analysts clearly believe Digimarc is more favorable than CSP.
CSP beats Digimarc on 9 of the 13 factors compared between the two stocks.
CSP Inc. develops and markets IT integration solutions, security and managed services, purpose built network adapters, and cluster computer systems for commercial and defense customers worldwide. The company's High Performance Products segment offers computing systems for digital signal processing applications in the defense market; Ethernet adapters and solutions for various applications in the packet capture, financial transaction, and storage interconnect markets; ARC Series adapters for financial trading and network monitoring; and nVoy Series products comprising 100G Packet Broker and 10G Packet Recorder, and specialized software under the Myricom brand. Its Technology Solutions segment provides third-party computer hardware and software as a value added reseller to various customers in Web and infrastructure hosting, education, telecommunications, healthcare services, distribution, financial and professional services, and manufacturing industries. This segment also offers professional IT consulting services, such as implementation, integration, migration, configuration, installation, and project management; storage and virtualization solutions; enterprise security intrusion prevention, network access control, and unified threat management services; and IT security compliance services. In addition, this segment provides unified communications, wireless, and routing and switching solutions; custom software applications and solutions development and support services; maintenance and technical support services; and managed IT services, such as monitoring, reporting, and management of alerts for the resolution and preventive general IT, as well as IT security support tasks. Further, this segment offers managed and cloud services, such as proactive monitoring and remote management of IT Infrastructure, collaboration and resale, security, and backup and replication. CSP Inc. was founded in 1968 and is headquartered in Lowell, Massachusetts.
Digimarc Corporation provides media identification and management solutions to government and commercial customers in the United States and internationally. It offers Digimarc Intuitive Computing Platform, a comprehensive set of technologies for identifying, discovering, and interacting with digitally-enhanced media, which includes Digimarc Barcode, a method for imperceptibly enhancing packaging, print, images, thermal labels, audio, and other objects with data that is detected by enabled devices, such as smart phones, computers, barcode scanners, and machine-vision equipment. The company also provides Digimarc Discover software that enables an ecosystem of connected devices to identify content or materials and deliver information. Its solutions are used in various media identification and management products and solutions, such as retail point of sale transaction processing; track and trace of products within the supply chain; quality control in manufacturing processes; counterfeiting and piracy deterrence; online e-publication piracy protection; content identification and media management; authentication and monitoring; linking to networks and providing access to information; and enhanced services in support of mobile commerce. The company provides its solutions directly and through its business partners. Digimarc Corporation was founded in 2008 and is based in Beaverton, Oregon.
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