Reviewing NetScout Systems (NASDAQ:NTCT) & Cisco Systems (NASDAQ:CSCO)

NetScout Systems (NASDAQ:NTCT) and Cisco Systems (NASDAQ:CSCO) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, analyst recommendations and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for NetScout Systems and Cisco Systems, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NetScout Systems	0	1	0	0	2.00
Cisco Systems	0	7	13	2	2.77

NetScout Systems currently has a consensus price target of $25.00, suggesting a potential upside of 5.98%. Cisco Systems has a consensus price target of $69.11, suggesting a potential upside of 4.21%. Given NetScout Systems’ higher possible upside, equities research analysts plainly believe NetScout Systems is more favorable than Cisco Systems.

Institutional & Insider Ownership

91.6% of NetScout Systems shares are held by institutional investors. Comparatively, 73.3% of Cisco Systems shares are held by institutional investors. 3.7% of NetScout Systems shares are held by company insiders. Comparatively, 0.0% of Cisco Systems shares are held by company 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.

Risk and Volatility

NetScout Systems has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500. Comparatively, Cisco Systems has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500.

Earnings & Valuation

This table compares NetScout Systems and Cisco Systems”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NetScout Systems	$822.68 million	2.05	-$366.92 million	($5.15)	-4.58
Cisco Systems	$53.80 billion	4.88	$10.32 billion	$2.45	27.07

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

Profitability

This table compares NetScout Systems and Cisco Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NetScout Systems	-44.60%	7.37%	5.16%
Cisco Systems	17.60%	26.48%	9.87%

Summary

Cisco Systems beats NetScout Systems on 12 of the 15 factors compared between the two stocks.

About NetScout Systems

NetScout Systems, Inc. provides service assurance and cybersecurity solutions for protect digital business services against disruptions in the United States, Europe, Asia, and internationally. The company offers nGeniusONE management software that enables customers to predict, preempt, and resolve network and service delivery problems, as well as facilitate the optimization and capacity planning of their network infrastructures; and specialized platforms and analytic modules that enable its customers to analyze and troubleshoot traffic in radio access and Wi-Fi networks. It also provides nGeniusPULSE, an active testing tool that enables enterprises to identify infrastructure performance issues and determine application availability, reliability, and performance; and nGenius Business Analytics solution, which enables service providers to analyze their network traffic. In addition, the company offers ISNG, an advanced passive network probe; packet flow systems that deliver targeted network traffic access to various monitoring and security tools and systems; and a suite of test access points that enable non-disruptive access to network traffic. Further, it provides cybersecurity solutions to protect their networks against distributed denial of service attacks under the Arbor brand, such as Arbor Sightline, Arbor Threat Mitigation System, Arbor Insight, Arbor Edge Defense, and Arbor Cloud. Additionally, the company offers advanced threat detection solutions, such as Omnis Cyber Investigator. It serves enterprise customers in various industries, including financial services, technology, manufacturing, healthcare, utilities, education, transportation, and retail; mobile operators, wireline operators, cable operators, Internet service providers, and cloud providers; and governmental agencies through a direct sales force, and indirect reseller and distribution channels. The company was incorporated in 1984 and is headquartered in Westford, Massachusetts.

About Cisco Systems

Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.