Critical Contrast: Franklin Wireless (NASDAQ:FKWL) and Ituran Location and Control (NASDAQ:ITRN)

Franklin Wireless (NASDAQ:FKWL) and Ituran Location and Control (NASDAQ:ITRN) are both small-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, institutional ownership, earnings, valuation and profitability.

Profitability

This table compares Franklin Wireless and Ituran Location and Control’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin Wireless	-2.07%	-2.98%	-2.16%
Ituran Location and Control	16.28%	29.03%	16.29%

Volatility and Risk

Franklin Wireless has a beta of 0.28, meaning that its stock price is 72% less volatile than the S&P 500. Comparatively, Ituran Location and Control has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500.

Institutional and Insider Ownership

18.5% of Franklin Wireless shares are held by institutional investors. Comparatively, 94.8% of Ituran Location and Control shares are held by institutional investors. 28.4% of Franklin Wireless shares are held by insiders. Comparatively, 0.0% of Ituran Location and Control shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Franklin Wireless and Ituran Location and Control, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin Wireless	1	0	1	0	2.00
Ituran Location and Control	0	1	4	0	2.80

Franklin Wireless currently has a consensus target price of $6.00, suggesting a potential upside of 140.00%. Ituran Location and Control has a consensus target price of $60.67, suggesting a potential upside of 19.21%. Given Franklin Wireless’ higher probable upside, equities analysts plainly believe Franklin Wireless is more favorable than Ituran Location and Control.

Earnings & Valuation

This table compares Franklin Wireless and Ituran Location and Control”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin Wireless	$46.09 million	0.64	-$240,000.00	($0.06)	-41.67
Ituran Location and Control	$359.02 million	2.82	$57.97 million	$3.24	15.71

Ituran Location and Control has higher revenue and earnings than Franklin Wireless. Franklin Wireless is trading at a lower price-to-earnings ratio than Ituran Location and Control, indicating that it is currently the more affordable of the two stocks.

Summary

Ituran Location and Control beats Franklin Wireless on 12 of the 14 factors compared between the two stocks.

About Franklin Wireless

Franklin Wireless Corp. provides integrated wireless solutions. The company's products include 5G/4G wireless broadband products, such as wi-fi mobile hotspot, fixed wireless routers, and enterprise gateway CPE; and IoT tracking and connected devices, including smart IoT tracking device, connected car, and home phone connect. It also offers IOT server platform and application, which comprises Pintrac, a cloud based telecom grade server platform; Pintrac Mobile Device Management, an LTE hotspot; Pintrac Pet, a pet tracking application; Pintrac Auto that tracks, locates, and manages vehicles for consumers and businesses; and JEXtream, a cloud based telecom grade server platform for 5G devices and routers that enables enhanced remote management of device functionality. The company directly markets and sells its products to wireless operators, as well as indirectly through strategic partners and distributors located primarily in the North America, the Caribbean and South America, and Asia. Franklin Wireless Corp. was founded in 1981 and is headquartered in San Diego, California.

About Ituran Location and Control

Ituran Location and Control Ltd., together with its subsidiaries, provides location based telematics services and machine-to-machine telematics products. It operates through two segments, Telematics Services and Telematics Products. The Telematics services segment offers stolen vehicle recovery and tracking services, which enables to locate, track, and recover stolen vehicles for its subscribers; fleet management services that enable corporate and individual customers to track and manage their vehicles in real time; and locator services that allow customers to protect valuable merchandise and equipment. This segment also delivers on-demand navigation guidance, information, and assistance, including the provision of traffic reports and directions, as well as information on the location of gas stations, car repair shops, post offices, hospitals, and other facilities; and Connected Car, a service platform that includes a back-office application, a telematics device installed in the vehicle, mobile apps for IOS and Android users, and interface using the car infotainment screen, as well as usage based insurance and auto financing services. This segment serves insurance companies and agents, car manufacturers, dealers and importers, cooperative sales channels, and private subscribers. The Telematics Products segment offers Base Site, a radio receiver that includes a processor and a data computation unit to collect and send data to and from transponders, and to control centers; Control Center, a center consisting of software used to collect data from various base sites, conduct location calculations, and transmit location data to various customers and law enforcement agencies; navigation and tracking devices installed in vehicles; and SMART, a portable transmitter installed in vehicles that sends a signal to the base site enabling the location of vehicles, equipment, or an individual. The company was incorporated in 1994 and is headquartered in Azor, Israel.