Analyzing Socket Mobile (NASDAQ:SCKT) and Turtle Beach (NASDAQ:TBCH)

Socket Mobile (NASDAQ:SCKT) and Turtle Beach (NASDAQ:TBCH) are both small-cap computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, profitability, earnings, analyst recommendations, institutional ownership, dividends and valuation.

Risk & Volatility

Socket Mobile has a beta of 0.91, suggesting that its share price is 9% less volatile than the S&P 500. Comparatively, Turtle Beach has a beta of 2.01, suggesting that its share price is 101% more volatile than the S&P 500.

Profitability

This table compares Socket Mobile and Turtle Beach’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Socket Mobile	-15.09%	-14.85%	-9.72%
Turtle Beach	4.03%	15.59%	6.22%

Institutional & Insider Ownership

3.8% of Socket Mobile shares are held by institutional investors. Comparatively, 67.0% of Turtle Beach shares are held by institutional investors. 48.1% of Socket Mobile shares are held by insiders. Comparatively, 3.3% of Turtle Beach shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Socket Mobile and Turtle Beach, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Socket Mobile	0	0	0	0	0.00
Turtle Beach	0	1	1	0	2.50

Turtle Beach has a consensus price target of $12.50, indicating a potential downside of 3.92%. Given Turtle Beach’s stronger consensus rating and higher probable upside, analysts clearly believe Turtle Beach is more favorable than Socket Mobile.

Valuation and Earnings

This table compares Socket Mobile and Turtle Beach”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Socket Mobile	$18.76 million	0.51	-$2.24 million	($0.36)	-3.36
Turtle Beach	$380.82 million	0.69	$16.18 million	$0.73	17.82

Turtle Beach has higher revenue and earnings than Socket Mobile. Socket Mobile is trading at a lower price-to-earnings ratio than Turtle Beach, indicating that it is currently the more affordable of the two stocks.

Summary

Turtle Beach beats Socket Mobile on 13 of the 14 factors compared between the two stocks.

About Socket Mobile

Socket Mobile, Inc. provides data capture and delivery solutions in the United States, Europe, Asia, and internationally. Its products and solutions are integrated into mobile applications for applications in the areas of point of sale, commercial services, asset tracking, manufacturing and quality control processes, transportation and logistics, event management, medical, and education. The company also offers cordless data capture devices that connect through Bluetooth and work with applications running on smartphones, mobile computers, and tablets; SocketScan and DuraScan 700 series, companion scanners and 800 series, attachable scanners, and wearables; and DuraSled, a barcode scanning sled that protects phones from impact damage and provides charging solutions. In addition, it offers D600, a handheld model to reads and writes various types of electronic SmartTags and transfers data with near-field communication (NFC); S550, a contactless membership card reader/writer; and S370 product that supports barcode scanning, and NFC reading and writing technologies. Further, the company provides SocketCam C820 and C860, which are camera-based barcode scanners; software developer kits, such as CaptureSDK that enables the App providers to modify captured data, control the placement of the barcoded or RFID data in their applications, and control the feedback to the user. It serves retail, commercial services, industrial and manufacturing, transportation and logistics, and healthcare industries through a network of distributors, online resellers, and application providers, as well as online stores. The company was formerly known as Socket Communications, Inc. and changed its name to Socket Mobile, Inc. in April 2008. Socket Mobile, Inc. was founded in 1992 and is headquartered in Fremont, California.

About Turtle Beach

Turtle Beach Corporation operates as an audio technology company. It develops, commercializes, and markets gaming headset solutions for various platforms, including video game and entertainment consoles, personal computers, handheld consoles, tablets, and mobile devices under the Turtle Beach brand. The company also offers gaming headsets, keyboards, mice, mousepads, and other accessories for the personal computer peripherals market under the brand of ROCCAT, as well as digital USB and analog microphones under the Neat Microphones brand. It serves retailers, distributors, and other customers in North America, the United Kingdom, Europe, and internationally. The company was founded in 1975 and is headquartered in White Plains, New York.