Analyzing Motorola Solutions (NYSE:MSI) and Allot (NASDAQ:ALLT)

Motorola Solutions (NYSE:MSI) and Allot (NASDAQ:ALLT) are both technology companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Profitability

This table compares Motorola Solutions and Allot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Motorola Solutions	17.44%	98.22%	12.87%
Allot	9.40%	9.64%	5.99%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Motorola Solutions and Allot, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Motorola Solutions	0	2	10	1	2.92
Allot	1	1	4	0	2.50

Motorola Solutions currently has a consensus target price of $519.44, indicating a potential upside of 6.56%. Allot has a consensus target price of $13.38, indicating a potential upside of 68.66%. Given Allot’s higher probable upside, analysts clearly believe Allot is more favorable than Motorola Solutions.

Institutional & Insider Ownership

84.2% of Motorola Solutions shares are owned by institutional investors. Comparatively, 51.5% of Allot shares are owned by institutional investors. 1.3% of Motorola Solutions shares are owned by company insiders. Comparatively, 3.4% of Allot shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Motorola Solutions and Allot”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Motorola Solutions	$11.68 billion	6.91	$2.15 billion	$12.70	38.38
Allot	$108.95 million	3.54	$3.70 million	$0.22	36.05

Motorola Solutions has higher revenue and earnings than Allot. Allot is trading at a lower price-to-earnings ratio than Motorola Solutions, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Motorola Solutions has a beta of 0.87, suggesting that its stock price is 13% 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.

Summary

Motorola Solutions beats Allot on 12 of the 15 factors compared between the two stocks.

About Motorola Solutions

Motorola Solutions, Inc. provides public safety and enterprise security solutions in the United States, the United Kingdom, Canada, and internationally. The company operates in two segments, Products and Systems Integration, and Software and Services. The Products and Systems Integration segment offers a portfolio of infrastructure, devices, accessories, and video security devices and infrastructure, as well as the implementation and integration of systems, devices, software, and applications for government, public safety, and commercial customers who operate private communications networks and video security solutions, as well as manage a mobile workforce. Its land mobile radio communications, and video security and access control devices include two-way portable and vehicle-mounted radios, fixed video cameras, and accessories; communications network core and central processing software, base stations, consoles, and repeaters; and video analytics, network video management hardware and software, and access control solutions. The Software and Services segment provides public safety and enterprise command center, unified communications applications, mobile video equipment, and video software solutions; repair, technical support, and maintenance services; and monitoring, software updates, and cybersecurity services to government, public safety, and commercial communications networks. It serves hospitality; manufacturing; military and defence; public safety; mining; oil and gas; transportation and logistics; utilities industries. The company was formerly known as Motorola, Inc. and changed its name to Motorola Solutions, Inc. in January 2011. Motorola Solutions, Inc. was founded in 1928 and is headquartered in Chicago, Illinois.

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.