Head-To-Head Analysis: Quantum (NASDAQ:QMCO) & Netlist (OTCMKTS:NLST)

Netlist (OTCMKTS:NLST) and Quantum (NASDAQ:QMCO) are both small-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Profitability

This table compares Netlist and Quantum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Netlist	-33.07%	N/A	-110.40%
Quantum	N/A	N/A	N/A

Institutional & Insider Ownership

0.0% of Netlist shares are owned by institutional investors. Comparatively, 63.7% of Quantum shares are owned by institutional investors. 4.0% of Netlist shares are owned by company insiders. Comparatively, 4.5% of Quantum shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Netlist and Quantum”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Netlist	$147.10 million	1.32	-$53.87 million	($0.18)	-3.69
Quantum	$311.60 million	0.18	-$41.29 million	N/A	N/A

Quantum has higher revenue and earnings than Netlist.

Risk and Volatility

Netlist has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Quantum has a beta of 2.68, suggesting that its share price is 168% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Netlist and Quantum, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Netlist	0	0	1	0	3.00
Quantum	0	2	1	0	2.33

Netlist presently has a consensus price target of $2.00, indicating a potential upside of 200.75%. Quantum has a consensus price target of $19.00, indicating a potential upside of 135.15%. Given Netlist’s stronger consensus rating and higher possible upside, research analysts clearly believe Netlist is more favorable than Quantum.

Summary

Quantum beats Netlist on 7 of the 10 factors compared between the two stocks.

About Netlist

Netlist, Inc. designs, manufactures, and markets memory subsystems for the server, high-performance computing, and communications markets in the United States and internationally. The company portfolio of proprietary technologies and design techniques, includes efficient planar design, alternative packaging techniques, and custom semiconductor logic, to deliver memory subsystems; and sells specialty memory modules and flash-based products for use in data center and industrial applications. It resells component products, including solid state drive (SSD), NAND flash, and dual inline memory module (DIMM) to storage customers, appliance customers, system builders, and cloud and datacenter customers; and sells component inventory to distributors and other users of memory integrated circuits. The company markets and sells its products through a direct sales force and a network of independent sales representatives. Netlist, Inc. was incorporated in 2000 and is headquartered in Irvine, California.

About Quantum

Quantum Corporation provides products for storing and managing digital video and unstructured data in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company offers Myriad All-Flash File and Object Storage Software for high performance enterprise unstructured data applications such as AI, machine learning, and data analytics; Unified Surveillance Platform Software that unified compute and storage for video surveillance recording, storage, and analytics; StorNext Hybrid Flash/Disk File Storage Software for video editing, post-production, and streaming applications, as well as digital file archives; and CatDV Asset Management Software for indexing, cataloging, enriching video, audio, and image files, and workflow orchestration. It also provides ActiveScale Object Storage Software that scalable and durable storage for long term data preservation and protection; DXi Backup Appliances to build backup appliances for high-speed backup and recovery and multisite data protection; and Scalar Tape Storage that secure storage for long term data archiving and offline data protection which are used by hyperscalers and enterprises. In addition, the company sells linear tape-open (LTO) a tape drives for small business data protection and archiving; and LTO media for use in tape storage systems. Further, it offers global support, managed services, customer support agreements, software subscriptions, installation, education, and consulting and training services, as well as Quantum-as-a-Service. The company sells its products through a network of distributors, value-added resellers, direct marketing resellers, original equipment manufacturers, and other suppliers, as well as directly to corporate entities and government agencies. It has a partnership with Tiger Surveillance to deliver end-to-end solutions for long-term retention and archiving of video surveillance data. Quantum Corporation was founded in 1980 and is headquartered in San Jose, California.