Optical Cable (NASDAQ:OCC – Get Free Report) and Allot (NASDAQ:ALLT – Get Free Report) are both small-cap technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.
Analyst Ratings
This is a summary of current ratings for Optical Cable and Allot, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Optical Cable | 0 | 2 | 0 | 0 | 2.00 |
| Allot | 1 | 1 | 4 | 0 | 2.50 |
Allot has a consensus price target of $13.38, suggesting a potential upside of 54.09%. Given Allot’s stronger consensus rating and higher possible upside, analysts clearly believe Allot is more favorable than Optical Cable.
Profitability
This table compares Optical Cable and Allot’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Optical Cable | 3.10% | 15.88% | 6.17% |
| Allot | 9.40% | 9.64% | 5.99% |
Risk & Volatility
Optical Cable has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500. Comparatively, Allot has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500.
Institutional and Insider Ownership
13.6% of Optical Cable shares are held by institutional investors. Comparatively, 51.5% of Allot shares are held by institutional investors. 22.4% of Optical Cable shares are held by company insiders. Comparatively, 3.4% of Allot shares are held 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.
Valuation & Earnings
This table compares Optical Cable and Allot”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Optical Cable | $73.04 million | 1.40 | -$1.46 million | $0.29 | 39.76 |
| Allot | $108.95 million | 3.93 | $3.70 million | $0.22 | 39.45 |
Allot has higher revenue and earnings than Optical Cable. Allot is trading at a lower price-to-earnings ratio than Optical Cable, indicating that it is currently the more affordable of the two stocks.
Summary
Allot beats Optical Cable on 9 of the 14 factors compared between the two stocks.
About Optical Cable
Optical Cable Corporation, together with its subsidiaries, engages in the manufacture and sale of fiber optic and copper data communications cabling and connectivity solutions primarily for the enterprise market in the United States and internationally. The company provides fiber optic and hybrid cables for high bandwidth transmission of data, video, and voice communications; and copper datacom cables, including unshielded and shielded twisted pair constructions. Its fiber optic connectivity products include fiber optic wall mounts, cabinet mount and rack mount enclosures, pre-terminated fiber optic enclosures, fiber optic connectors, splice trays, fiber optic jumpers, plug and play cassette modules, pre-terminated fiber optic cable assemblies, adapters, and accessories; and copper connectivity products comprising category compliant patch panels, jacks, plugs, patch cords, faceplates, surface mounted boxes, distribution and multi-media boxes, copper rack mount and wall mount enclosures, cable assemblies, cable organizers, and other wiring products for equipment rooms, telecommunications closets, data centers, and workstation applications. In addition, the company offers network, data storage, and telecommunications management systems, such as data cabinets, wall mount enclosures, horizontal and vertical cable management systems, and open frame relay racks; and datacom wiring products, including various enclosures, and modules and modular outlets for single dwelling and multiple dwelling residential uses. Further, it provides specialty fiber optic connectors and connectivity components, copper datacom connectors, and related systems and solutions for military, other harsh environment, and special applications, as well as cylindrical connector products. The company sells its products to distributors, original equipment manufacturers, value-added resellers, and end-users. Optical Cable Corporation was incorporated in 1983 and is headquartered in Roanoke, Virginia.
About Allot
Allot Communications Ltd. is a provider of leading innovative network intelligence and security solutions for service providers worldwide, enhancing value to their customers. Their solutions are deployed globally for network and application analytics, traffic control and shaping, network-based security services, and more. Allot’s multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises. Their industry leading network-based security as a service solution has achieved over 50% penetration with some service providers and is already used by over 20 million subscribers in Europe.
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