Digimarc (NASDAQ:DMRC) vs. Assa Abloy (OTCMKTS:ASAZY) Critical Survey

Assa Abloy (OTCMKTS:ASAZY) and Digimarc (NASDAQ:DMRC) are both industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, earnings, valuation, profitability and analyst recommendations.

Volatility and Risk

Assa Abloy has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500. Comparatively, Digimarc has a beta of 1.68, suggesting that its stock price is 68% more volatile than the S&P 500.

Valuation and Earnings

This table compares Assa Abloy and Digimarc”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Assa Abloy	$14.20 billion	N/A	$1.48 billion	$0.71	27.24
Digimarc	$38.42 million	3.96	-$39.01 million	($1.71)	-4.08

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

Profitability

This table compares Assa Abloy and Digimarc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Assa Abloy	9.57%	14.24%	6.70%
Digimarc	-109.17%	-50.08%	-38.57%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Assa Abloy and Digimarc, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Assa Abloy	0	3	1	0	2.25
Digimarc	1	0	1	0	2.00

Digimarc has a consensus target price of $20.00, indicating a potential upside of 186.33%. Given Digimarc’s higher probable upside, analysts clearly believe Digimarc is more favorable than Assa Abloy.

Insider & Institutional Ownership

66.9% of Digimarc shares are owned by institutional investors. 19.3% of Digimarc shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Assa Abloy beats Digimarc on 8 of the 12 factors compared between the two stocks.

About Assa Abloy

ASSA ABLOY AB (publ) provides door opening and access products, solutions, and services for the institutional, commercial, and residential markets in Europe, the Middle East, India, Africa, North and South America, Asia, and Oceania. The company provides digital access solutions, such as electronic access control ecosystem, wireless solutions, electronic key solutions, standalone access solutions, and wired solutions; swing, revolving, and sliding doors; mechanical products, including hinges, lever handles, mortise lockcases, euro profile cylinders, panic exit devices, door closers, floor spring, and general hardware; and doors. It offers Openings Studio, a building information modeling software ecosystem is collaboration tool for designing, documenting, and managing openings. The company provides its products primarily under the ASSA ABLOY, Yale, and HID brands. It sells its products through distributors and wholesalers. The company serves aviation, education, distribution and logistics, entertainment and public facility, finance and banking, government and military, healthcare, hospitality, manufacturing, mining, office and enterprise, homes and residence, retail, shipyards, and transportation industries. ASSA ABLOY AB (publ) was incorporated in 1954 and is based in Stockholm, Sweden.

About Digimarc

Digimarc Corporation, together with its subsidiaries, provides automatic identification solutions to commercial and government customers in the United States and internationally. The company offers Digimarc Validate protects, a cloud-based record of product authentication information; Digimarc Engage, an interactive communications channel connecting brands and consumers; and Digimarc Recycle. Its solutions are used in various application solutions, such as sorting of consumer-packaged goods in recycling streams. The company offers its solutions through its sales personnel and business partners. Digimarc Corporation was incorporated in 2008 and is based in Beaverton, Oregon.