Head to Head Review: Sequans Communications (NYSE:SQNS) & Rambus (NASDAQ:RMBS)

Sequans Communications (NYSE:SQNS) and Rambus (NASDAQ:RMBS) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, risk, profitability, valuation, dividends and earnings.

Volatility and Risk

Sequans Communications has a beta of 0.24, indicating that its stock price is 76% less volatile than the S&P 500. Comparatively, Rambus has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.

Profitability

This table compares Sequans Communications and Rambus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sequans Communications	-140.08%	-1,229.91%	-38.35%
Rambus	48.31%	16.74%	13.70%

Earnings & Valuation

This table compares Sequans Communications and Rambus”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sequans Communications	$28.26 million	2.21	-$40.99 million	($0.79)	-1.28
Rambus	$477.53 million	8.71	$333.90 million	$3.27	11.80

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

Institutional & Insider Ownership

63.3% of Sequans Communications shares are owned by institutional investors. Comparatively, 88.5% of Rambus shares are owned by institutional investors. 9.4% of Sequans Communications shares are owned by company insiders. Comparatively, 1.0% of Rambus shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Sequans Communications and Rambus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sequans Communications	0	0	1	0	3.00
Rambus	0	0	4	0	3.00

Sequans Communications presently has a consensus target price of $3.00, suggesting a potential upside of 197.03%. Rambus has a consensus target price of $77.75, suggesting a potential upside of 101.53%. Given Sequans Communications’ higher possible upside, equities research analysts plainly believe Sequans Communications is more favorable than Rambus.

Summary

Rambus beats Sequans Communications on 11 of the 13 factors compared between the two stocks.

About Sequans Communications

Sequans Communications S.A. engages in the fabless designing, developing, and supplying of cellular semiconductor solutions for massive and broadband Internet of Things (IoT) markets in Taiwan, Korea, China, rest of Asia, Germany, the United States, and internationally. It offers baseband solutions for use in encoding and decoding data based on 4G and 5G protocols for wireless processing platform for a cellular device; RF transceivers used to transmit and receive wireless transmissions; highly integrated SoC solutions that combine various functions into a single die or package; and LTE modules. The company also provides software, including source code and tools to enable manufacturers to integrate their solutions into their devices; and design support services. The company serves OEMs and ODMs Customers, as well as 4G and 5G wireless carriers. Sequans Communications S.A. was incorporated in 2003 and is based in Paris, France.

About Rambus

Rambus Inc. provides semiconductor products in the United States, South Korea, Singapore, and internationally. The company offers DDR memory interface chips, including DDR5 and DDR4 memory interface chips to module manufacturers, OEMs, and hyperscalers; silicon IP, such as interface and security IP solutions that move and protect data in advanced data center, government, and automotive applications; and interface IP solutions for high-speed memory and chip-to-chip digital controller IP. It also provides a portfolios of security IP solutions, including crypto cores, hardware roots of trust, high-speed protocol engines, and chip provisioning technologies; and portfolio of patents that covers memory architecture, high-speed serial links, and security products. It markets its products and services through its direct sales force and distributors. Rambus Inc. was incorporated in 1990 and is headquartered in San Jose, California.