Reviewing ImageWare Systems (OTCMKTS:IWSY) & Neonode (NASDAQ:NEON)

ImageWare Systems (OTCMKTS:IWSY) and Neonode (NASDAQ:NEON) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, valuation, profitability and risk.

Risk and Volatility

ImageWare Systems has a beta of 2.4, suggesting that its share price is 140% more volatile than the S&P 500. Comparatively, Neonode has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500.

Institutional and Insider Ownership

2.2% of ImageWare Systems shares are owned by institutional investors. Comparatively, 11.6% of Neonode shares are owned by institutional investors. 37.7% of ImageWare Systems shares are owned by company insiders. Comparatively, 23.9% of Neonode 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.

Profitability

This table compares ImageWare Systems and Neonode’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ImageWare Systems	N/A	N/A	N/A
Neonode	411.88%	-37.98%	-32.59%

Valuation & Earnings

This table compares ImageWare Systems and Neonode”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ImageWare Systems	N/A	N/A	N/A	N/A	N/A
Neonode	$2.06 million	13.28	$8.49 million	($0.32)	-5.09

Neonode has higher revenue and earnings than ImageWare Systems.

Analyst Ratings

This is a breakdown of recent ratings and price targets for ImageWare Systems and Neonode, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ImageWare Systems	0	0	0	0	0.00
Neonode	1	1	0	0	1.50

Neonode has a consensus price target of $6.00, indicating a potential upside of 268.10%. Given Neonode’s stronger consensus rating and higher possible upside, analysts clearly believe Neonode is more favorable than ImageWare Systems.

Summary

Neonode beats ImageWare Systems on 5 of the 9 factors compared between the two stocks.

About ImageWare Systems

ImageWare Systems, Inc. operates as a biometric solution provider in the United States and internationally. It offers Imageware Biometric Engine, a biometric identity and authentication database built for multi-biometric enrollment, management, and authentication. The company also provides Imageware Proof that enables an entity to prove user identity from their biometrics, government issued ID, and credit bureau data; Imageware Capture that enables the capture of biographic and biometric details, such as face, fingerprint, palm print, and iris, as well as scars, marks, and tattoos; Imageware Identify, which enables a user to identify others from their biometrics; and Imageware Investigate that enables an officer to create digital lineups. In addition, it offers Imageware Credential that enables a user to design, build, and print badges for access control systems, which includes tickets, smart badges, wristbands, personal identity verification cards, and others; Imageware Digital ID, a decentralized identity service that enables self-sovereign identity underpinned by blockchain technology tied to biometrics; and Imageware Authenticate, which enables users to leverage multimodal biometrics hosted in a central server or cloud to log in to services and applications from a device. Further, the company provides Law Enforcement 2.0 solution which enables state, local, and federal agencies to capture, archive, search, retrieve, and share digital images, fingerprints, and other biometrics, as well as criminal history records on a stand-alone, networked, wireless or browser-based platform. It serves airports and seaports, education, financial, government, healthcare, and law enforcement industries. The company was incorporated in 1987 and is headquartered in San Diego, California.

About Neonode

Neonode Inc., together with its subsidiaries, develops optical sensing solutions for contactless touch, touch, and gesture sensing in the United States, Japan, South Korea, Germany, Switzerland, France, Sweden, China, and internationally. It also offers software solutions for machine perception to detect and track persons and objects in video streams from cameras and other types of imagers. In addition, the company sells touch sensor modules to OEMs, original design manufacturers, and systems integrators. Further, it licenses its zForce technology to original equipment manufacturers and automotive Tier 1 suppliers, as well as provides non-recurring engineering services related to application development. It serves office equipment, automotive, industrial automation, medical, military, and avionics markets. Neonode Inc. was incorporated in 1997 and is headquartered in Stockholm, Sweden.