Reviewing Radcom (NASDAQ:RDCM) & Cisco Systems (NASDAQ:CSCO)

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

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Radcom	$61.01 million	3.73	$6.97 million	$0.58	25.07
Cisco Systems	$56.65 billion	4.76	$10.18 billion	$2.62	26.03

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

Institutional & Insider Ownership

48.3% of Radcom shares are held by institutional investors. Comparatively, 73.3% of Cisco Systems shares are held by institutional investors. 69.0% of Radcom 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 hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and target prices for Radcom and Cisco Systems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Radcom	0	0	1	0	3.00
Cisco Systems	0	10	13	1	2.63

Radcom currently has a consensus price target of $18.00, suggesting a potential upside of 23.80%. Cisco Systems has a consensus price target of $74.53, suggesting a potential upside of 9.26%. Given Radcom’s stronger consensus rating and higher probable upside, research analysts clearly believe Radcom is more favorable than Cisco Systems.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Radcom	14.14%	9.96%	7.42%
Cisco Systems	18.45%	27.06%	10.20%

Risk & Volatility

Radcom has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, Cisco Systems has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Summary

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

About Radcom

RADCOM Ltd. provides 5G ready cloud-native, network intelligence, and service assurance solutions for telecom operators or communication service providers (CSPs). It offers RADCOM ACE, including RADCOM Service Assurance, a cloud-native, 5G-ready, and virtualized service assurance solutions, which allows telecom operators to gain end-to-end network visibility and customer experience insights across all networks; RADCOM Network Visibility, a cloud-native network packet broker and filtering solution that allows CSPs to manage network traffic at scale across multiple cloud environments, and control the visibility layer to perform analysis of select datasets; and RADCOM Network Insights, a business intelligence solution that offers insights for multiple use cases enabled by data captured and correlated through RADCOM Network Visibility and RADCOM Service Assurance. The company also provides solutions for mobile and fixed networks, such as 5G, long term evolution (LTE), voice over LTE, voice over Wifi, IP multimedia subsystem, voice over IP, and universal mobile telecommunication service. It sells its products directly to customers through executives and sales representatives, as well as through a network of distributors and resellers in North America, Asia Pacific, Latin America, Europe, the Middle East, Africa, and Israel. The company was formerly known as Big Blue Catalogue Ltd. and changed its name to RADCOM Ltd. in 1989. RADCOM Ltd. was incorporated in 1985 and is headquartered in Tel Aviv, Israel.

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.