MTS Systems Corporation (NASDAQ: MTSC) and Aerohive Networks (NYSE:HIVE) are both small-cap computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, valuation, dividends and earnings.
Profitability
This table compares MTS Systems Corporation and Aerohive Networks’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| MTS Systems Corporation | 3.13% | 12.49% | 4.31% |
| Aerohive Networks | -18.58% | -107.93% | -21.00% |
Dividends
MTS Systems Corporation pays an annual dividend of $1.20 per share and has a dividend yield of 2.6%. Aerohive Networks does not pay a dividend. MTS Systems Corporation pays out 91.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional & Insider Ownership
47.5% of Aerohive Networks shares are owned by institutional investors. 1.5% of MTS Systems Corporation shares are owned by insiders. Comparatively, 26.2% of Aerohive Networks shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
MTS Systems Corporation has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500. Comparatively, Aerohive Networks has a beta of 1.48, meaning that its share price is 48% more volatile than the S&P 500.
Earnings and Valuation
This table compares MTS Systems Corporation and Aerohive Networks’ revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| MTS Systems Corporation | $801.32 million | 0.99 | $113.92 million | $1.31 | 35.73 |
| Aerohive Networks | $160.72 million | 1.17 | -$23.73 million | ($0.57) | -6.11 |
MTS Systems Corporation has higher revenue and earnings than Aerohive Networks. Aerohive Networks is trading at a lower price-to-earnings ratio than MTS Systems Corporation, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent ratings for MTS Systems Corporation and Aerohive Networks, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| MTS Systems Corporation | 0 | 1 | 2 | 0 | 2.67 |
| Aerohive Networks | 0 | 3 | 3 | 0 | 2.50 |
MTS Systems Corporation presently has a consensus price target of $58.00, indicating a potential upside of 23.93%. Aerohive Networks has a consensus price target of $6.05, indicating a potential upside of 73.79%. Given Aerohive Networks’ higher probable upside, analysts plainly believe Aerohive Networks is more favorable than MTS Systems Corporation.
Summary
MTS Systems Corporation beats Aerohive Networks on 8 of the 15 factors compared between the two stocks.
About MTS Systems Corporation
MTS Systems Corporation is a supplier of test systems and position sensors. The Company operates through two segments: Test and Sensors. The Test segment provides testing solutions, including hardware, software and services to ground vehicles, materials and structures markets. The Sensors segment provides position sensors for a range of industrial and mobile hydraulic applications. The Sensors segment products are used by industrial machinery and mobile equipment manufacturers to automate the operation of their products for safety and end-user productivity. The Sensors segment manufactures products utilizing magnetostriction technology. Its technology, Temposonics, offers non-contact position sensing. Its Temposonics sensors provide position feedback for motion control systems. It also provides various service offerings, including calibration, maintenance, training and consulting. The Company has its manufacturing facilities in North America, Europe and Asia.
About Aerohive Networks
Aerohive Networks, Inc. together with its subsidiaries, has designed and developed a cloud-managed mobile networking platform that enables enterprises to deploy and manage a mobile-centric network edge. Its portfolio of products and solutions is built around sets of technologies and solutions, which include Enterprise Cloud Networking, Wireless Fidelity (Wi-Fi) Connectivity and Application and Insights. It conducts its business in geographic regions, including Americas; Europe, the Middle East and Africa, and Asia Pacific. Its product portfolio includes hardware products, cloud-based network management and applications, and support services. Its hardware products include access points, branch routers and access switches. Its hardware products are developed by its hardware design team working in conjunction with original design manufacturer partners, and leverage the commercially available Wi-Fi radios, network processors, crypto accelerators and switching chips.
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