Analyzing LightPath Technologies (NASDAQ:LPTH) and TranSwitch (OTCMKTS:TXCCQ)

TranSwitch (OTCMKTS:TXCCQ) and LightPath Technologies (NASDAQ:LPTH) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Valuation and Earnings

This table compares TranSwitch and LightPath Technologies’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TranSwitch	N/A	N/A	N/A	N/A	N/A
LightPath Technologies	$32.93 million	1.53	-$4.05 million	($0.18)	-7.22

TranSwitch has higher earnings, but lower revenue than LightPath Technologies.

Analyst Recommendations

This is a summary of current ratings and price targets for TranSwitch and LightPath Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TranSwitch	0	0	0	0	N/A
LightPath Technologies	0	0	2	0	3.00

LightPath Technologies has a consensus target price of $3.00, suggesting a potential upside of 130.77%.

Volatility and Risk

TranSwitch has a beta of 14.7, indicating that its stock price is 1,370% more volatile than the S&P 500. Comparatively, LightPath Technologies has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500.

Profitability

This table compares TranSwitch and LightPath Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TranSwitch	N/A	N/A	N/A
LightPath Technologies	-19.72%	-18.97%	-12.16%

Institutional and Insider Ownership

56.3% of LightPath Technologies shares are held by institutional investors. 6.3% of TranSwitch shares are held by company insiders. Comparatively, 5.2% of LightPath Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

TranSwitch beats LightPath Technologies on 5 of the 8 factors compared between the two stocks.

About TranSwitch

TranSwitch Corporation, together with its subsidiaries, designs, develops, and supplies integrated circuit and intellectual property solutions that provide functionality for voice, data, and video communications equipment for the customer premises and network infrastructure markets. The company provides integrated multi-core network processor system-on-a-chip (SoC) solutions for fixed, 3G and 4G mobile, VoIP, and multimedia applications. It offers converged network infrastructure products, including infrastructure VoIP processors for wire-line and wireless carrier equipment; access VoIP processors; and EoS/EoPDH mappers and framers for carriers to transport data traffic over SONET, SDH, and PDH networks. The company also offers broadband customer premises equipment, such as connectivity solutions comprising HDMI, DisplayPort, MHL, HDP, Ethernet IP cores, and MHDP transceivers for consumer electronics, home network equipment, and industrial and automotive applications; and multi-service SoCs for customer premises equipment that support telephone voice, fax, and routing functionality over broadband access networks. TranSwitch Corporation sells its products to public network system original equipment manufacturers (OEMs), WAN and LAN equipment OEMs, Internet-oriented OEMs, and communications test and performance measurement equipment OEMs; and government, universities, and private laboratories. The company offers its products directly in North America, Taiwan, China, Japan, Korea, and Europe, as well as through a network of distributors in North America, Asia, and Europe. TranSwitch Corporation was founded in 1988 and is headquartered in Shelton, Connecticut. On November 21, 2013, TranSwitch Corporation filed a voluntary petition for liquidation under Chapter 7 in the U.S. Bankruptcy Court for the District of Connecticut.

About LightPath Technologies

LightPath Technologies, Inc. designs, develops, manufactures, and distributes optical components and assemblies. The company offers precision molded glass aspheric optics, molded and diamond-turned infrared aspheric lenses, and other optical components used to produce products that manipulate light; and infrared products, including catalog and custom infrared optics. Its products are used in defense products, medical devices, laser aided industrial tools, automotive safety applications, barcode scanners, optical data storage, hybrid fiber coax datacom, telecommunications, machine vision and sensors, and other sectors. The company sells its products directly to customers in Europe and Asia. LightPath Technologies, Inc. was founded in 1985 and is headquartered in Orlando, Florida.