Comparing ARM (NASDAQ:ARM) and POET Technologies (OTCMKTS:POETF)

ARM (NASDAQ:ARM) and POET Technologies (OTCMKTS:POETF) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Valuation and Earnings

This table compares ARM and POET Technologies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ARM	$3.69 billion	35.61	$306.00 million	$0.76	165.20
POET Technologies	$4.43 million	280.93	-$18.17 million	($0.05)	-68.20

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

Profitability

This table compares ARM and POET Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ARM	21.82%	11.94%	8.62%
POET Technologies	N/A	-88.82%	-74.05%

Volatility and Risk

ARM has a beta of 4.77, indicating that its stock price is 377% more volatile than the S&P 500. Comparatively, POET Technologies has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for ARM and POET Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ARM	2	5	19	1	2.70
POET Technologies	0	0	0	0	0.00

ARM currently has a consensus price target of $165.23, suggesting a potential upside of 31.60%. Given ARM’s stronger consensus rating and higher probable upside, equities research analysts plainly believe ARM is more favorable than POET Technologies.

Insider and Institutional Ownership

7.5% of ARM shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

ARM beats POET Technologies on 13 of the 14 factors compared between the two stocks.

About ARM

Arm Holdings Plc engages in the licensing, marketing, research, and development of microprocessors, systems IP, graphics processing units, physical IP and associated systems IP, software, and tools. It operates through the following geographical segments: United Kingdom, United States, and Other Countries. The company was founded on November 12, 1990 and is headquartered in Cambridge, the United Kingdom.

About POET Technologies

POET Technologies, Inc. engages in the designing, developing, manufacturing and sale of opto-electronic solutions for the sensing, data communications and telecommunications markets. It developed POET Optical Interposer platform, which allows the integration of electronic and photonic devices into a single multi-chip module. The company was founded on November 14, 1985 and is headquartered in Toronto, Canada.