Lumentum (NASDAQ:LITE – Get Free Report) and Belden (NYSE:BDC – Get Free Report) are both technology companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, analyst recommendations, institutional ownership, valuation, earnings and profitability.
Analyst Recommendations
This is a summary of current recommendations for Lumentum and Belden, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Lumentum | 0 | 7 | 14 | 0 | 2.67 |
| Belden | 0 | 1 | 4 | 2 | 3.14 |
Lumentum presently has a consensus price target of $1,012.67, indicating a potential upside of 22.67%. Belden has a consensus price target of $156.25, indicating a potential upside of 16.26%. Given Lumentum’s higher possible upside, analysts clearly believe Lumentum is more favorable than Belden.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Lumentum | $1.65 billion | 39.04 | $25.90 million | $5.40 | 152.87 |
| Belden | $2.72 billion | 1.93 | $237.52 million | $6.15 | 21.85 |
Belden has higher revenue and earnings than Lumentum. Belden is trading at a lower price-to-earnings ratio than Lumentum, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Lumentum has a beta of 1.5, indicating that its share price is 50% more volatile than the S&P 500. Comparatively, Belden has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.
Institutional and Insider Ownership
94.1% of Lumentum shares are held by institutional investors. Comparatively, 98.8% of Belden shares are held by institutional investors. 0.4% of Lumentum shares are held by insiders. Comparatively, 1.1% of Belden shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Lumentum and Belden’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Lumentum | 17.61% | 24.81% | 6.89% |
| Belden | 8.52% | 25.00% | 9.24% |
Summary
Belden beats Lumentum on 9 of the 15 factors compared between the two stocks.
About Lumentum
Lumentum Holdings Inc. manufactures and sells optical and photonic products in the Americas, the Asia-Pacific, Europe, the Middle East, and Africa. The company operates through two segments: Optical Communications (OpComms) and Commercial Lasers (Lasers). The OpComms segment offers components, modules, and subsystems that enable the transmission and transport of video, audio, and data over high-capacity fiber optic cables. It offers tunable transponders, transceivers, and transmitter modules; tunable lasers, receivers, and modulators; transport products, such as reconfigurable optical add/drop multiplexers, amplifiers, and optical channel monitors, as well as components, including 980nm, multi-mode, and Raman pumps; and switches, attenuators, photodetectors, gain flattening filters, isolators, wavelength-division multiplexing filters, arrayed waveguide gratings, multiplex/de-multiplexers, and integrated passive modules. This segment also provides Super Transport Blade, which integrates optical transport functions into a single-slot blade; vertical-cavity surface-emitting lasers; directly modulated and electro-absorption modulated lasers; and laser illumination sources for 3D sensing systems. It serves customers in telecommunications, data communications, and consumer and industrial markets. The Commercial Lasers segment offers diode-pumped solid-state, fiber, diode, direct-diode, and gas lasers, such as argon-ion and helium-neon lasers for use in original equipment manufacturer applications. It serves customers in markets and applications, such as sheet metal processing, general manufacturing, biotechnology, solar cell processing, graphics and imaging, remote sensing, and precision machining. Lumentum Holdings Inc. was incorporated in 2015 and is headquartered in San Jose, California.
About Belden
Belden Inc. designs, manufactures, and markets a portfolio of signal transmission solutions for mission critical applications in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. It operates in two segments, Enterprise Solutions and Industrial Automation Solutions. The Enterprise Solutions segment offers copper cable and connectivity solutions, fiber cable and connectivity solutions, interconnect panels, racks and enclosures, and signal extension and matrix switching systems for use in applications, such as local area networks, data centers, access control, 5G, fiber to the home, and building automation. It also provides power, cooling, and airflow management products for mission-critical data center operations; and end-to-end fiber and copper network systems. This segment serves commercial real estate, education, financial, stadiums and venues, military installations, and broadband and wireless service providers, as well as data centers, governments, healthcare, and hospitality sectors. The Industrial Automation Solutions segment offers network infrastructure and digitization solutions; secure networks for the digitization and automation of industries and infrastructure; and products and solutions covering various aspects of data handling, including acquisition, transmission, orchestration, and management for applications in discrete automation, process automation, energy, and mass transit. It sells its products to distributors, end-users, installers, and original equipment manufacturers (OEMs). The company was formerly known as Belden CDT Inc. and changed its name to Belden Inc. in May 2007. Belden Inc. was founded in 1902 and is headquartered in Saint Louis, Missouri.
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