Contrasting Globalstar (NYSE:GSAT) & ORBCOMM (NYSE:ORBC)

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Globalstar (NYSE:GSAT) and ORBCOMM (NASDAQ:ORBC) are both small-cap computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Profitability

This table compares Globalstar and ORBCOMM’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Globalstar -59.84% -20.28% -9.43%
ORBCOMM -7.71% -8.66% -3.49%

Risk & Volatility

Globalstar has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500. Comparatively, ORBCOMM has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500.

Insider & Institutional Ownership

17.8% of Globalstar shares are owned by institutional investors. Comparatively, 68.3% of ORBCOMM shares are owned by institutional investors. 64.7% of Globalstar shares are owned by company insiders. Comparatively, 6.7% of ORBCOMM shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and price targets for Globalstar and ORBCOMM, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Globalstar 0 0 0 0 N/A
ORBCOMM 0 0 1 0 3.00

ORBCOMM has a consensus price target of $11.00, indicating a potential upside of 206.41%. Given ORBCOMM’s higher possible upside, analysts clearly believe ORBCOMM is more favorable than Globalstar.

Valuation and Earnings

This table compares Globalstar and ORBCOMM’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Globalstar $131.72 million 3.86 $15.32 million ($0.16) -1.90
ORBCOMM $272.01 million 1.03 -$18.42 million ($0.23) -15.61

Globalstar has higher earnings, but lower revenue than ORBCOMM. ORBCOMM is trading at a lower price-to-earnings ratio than Globalstar, indicating that it is currently the more affordable of the two stocks.

Summary

ORBCOMM beats Globalstar on 8 of the 13 factors compared between the two stocks.

Globalstar Company Profile

Globalstar, Inc. provides mobile satellite services worldwide. The company offers duplex two-way voice and data products, including mobile voice and data satellite communications services and equipment for remote business continuity, recreational usage, safety, emergency preparedness and response, and other applications; fixed voice and data satellite communications services and equipment at industrial, commercial, and residential sites, as well as rural villages and ships; and satellite data modem services comprising asynchronous and packet data services. It also provides SPOT consumer retail products, such as SPOT satellite GPS messenger for personal tracking, emergency location, and messaging solutions; and SPOT Trace, an anti-theft and asset tracking device. In addition, the company offers commercial Internet of Things one-way transmission products to track cargo containers and rail cars, as well as to monitor utility meters, and oil and gas assets. Further, it sells wholesale minutes to independent gateway operators (IGOs); and provides engineering services, such as hardware and software designs to develop specific applications; and installation of gateways and antennas. The company distributes its products directly, as well as through independent agents, dealers and resellers, retailers, IGOs, and its sales force and e-commerce Website. As of December 31, 2019, it had approximately 775,000 subscribers. The company primarily serves recreation and personal, government, public safety and disaster relief, oil and gas, maritime and fishing, construction, utilities, and transportation, as well as natural resources, mining, and forestry markets. Globalstar, Inc. was founded in 2003 and is headquartered in Covington, Louisiana.

ORBCOMM Company Profile

ORBCOMM Inc. provides Internet of Things solutions in the United States, South America, Japan, Europe, and internationally. The company offers network connectivity, devices, device management, and Web reporting applications that are designed to track, monitor, control, and enhance security for various assets, such as trailers, trucks, rail cars, sea containers, power generators, fluid tanks, marine vessels, diesel or electric powered generators, oil and gas wells, pipeline monitoring equipment, irrigation control systems, and utility meters in transportation and supply chain, heavy equipment, fixed asset monitoring, and maritime industries, as well as for governments. It also provides satellite automatic identification service data services for vessel navigation and to enhance maritime safety for government and commercial customers; and vehicle fleet management, as well as in-cab and fleet vehicle solutions using various network platforms, including its own constellation of low-Earth orbit satellites and accompanying ground infrastructure, as well as terrestrial-based cellular communication services through reseller agreements with various cellular wireless providers. In addition, the company offers customer solutions utilizing additional satellite network service options through service agreements with third party mobile satellite providers; and resells service using the two-way Inmarsat satellite network to provide higher bandwidth. It markets and sells its products and services directly to original equipment manufacturers, government customers, and end-users, as well as indirectly through market channel partners and affiliates. The company has a strategic alliance with Inmarsat plc. ORBCOMM Inc. was founded in 2001 and is headquartered in Rochelle Park, New Jersey.

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