Alimco Financial (OTCMKTS:ALMC) vs. EMCORE (NASDAQ:EMKR) Critical Analysis

Alimco Financial (OTCMKTS:ALMC) and EMCORE (NASDAQ:EMKR) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, profitability, dividends, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations for Alimco Financial and EMCORE, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alimco Financial	0	0	0	0	0.00
EMCORE	0	1	0	0	2.00

EMCORE has a consensus price target of $3.00, suggesting a potential downside of 3.23%. Given EMCORE’s stronger consensus rating and higher probable upside, analysts clearly believe EMCORE is more favorable than Alimco Financial.

Profitability

This table compares Alimco Financial and EMCORE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alimco Financial	N/A	N/A	N/A
EMCORE	-42.00%	-24.27%	-12.59%

Institutional and Insider Ownership

0.2% of Alimco Financial shares are owned by institutional investors. Comparatively, 65.7% of EMCORE shares are owned by institutional investors. 35.1% of Alimco Financial shares are owned by company insiders. Comparatively, 0.9% of EMCORE shares are owned by company 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.

Earnings and Valuation

This table compares Alimco Financial and EMCORE”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alimco Financial	N/A	N/A	N/A	N/A	N/A
EMCORE	$81.08 million	0.35	-$31.24 million	($2.92)	-1.06

Alimco Financial has higher earnings, but lower revenue than EMCORE.

Risk and Volatility

Alimco Financial has a beta of 0.1, indicating that its stock price is 90% less volatile than the S&P 500. Comparatively, EMCORE has a beta of 1.7, indicating that its stock price is 70% more volatile than the S&P 500.

Summary

EMCORE beats Alimco Financial on 5 of the 9 factors compared between the two stocks.

About Alimco Financial

Alimco Financial Corporation focuses on business financing solutions. The company was formerly known as Alliance Semiconductor Corporation and changed its name to Alimco Financial Corporation in 2017. Alimco Financial Corporation was founded in 1985 and is based in West Palm Beach, Florida.

About EMCORE

EMCORE Corporation, together with its subsidiaries, designs and manufactures fiber optic gyro, ring laser gyro, and micro electromechanical system-based inertial sensors and systems in the United States and internationally. It offers navigation system and inertial sensing products, such as gyroscopes and multi-axis sensors, inertial measurement units, fiber optic gyroscopes, quartz micro electromechanical systems, inertial navigation systems, tactical navigation, and naval and amphibious navigation, as well as radar positioning and pointing systems, and battlefield/artillery survey systems. The company sells its products through direct sales force, application engineers, third-party sales representatives, and distributors. EMCORE Corporation was founded in 1984 and is headquartered in Alhambra, California.