PDF Solutions (NASDAQ:PDFS) and Cicero (OTCMKTS:CICN) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Profitability

This table compares PDF Solutions and Cicero’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PDF Solutions -7.79% -3.61% -3.20%
Cicero -251.46% N/A -621.58%

Earnings and Valuation

This table compares PDF Solutions and Cicero’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PDF Solutions $101.87 million 2.70 -$1.33 million ($0.04) -213.00
Cicero $1.31 million 1.27 -$2.11 million N/A N/A

PDF Solutions has higher revenue and earnings than Cicero.

Risk and Volatility

PDF Solutions has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, Cicero has a beta of 0.06, meaning that its share price is 94% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for PDF Solutions and Cicero, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PDF Solutions 0 1 0 0 2.00
Cicero 0 0 0 0 N/A

PDF Solutions presently has a consensus target price of $13.00, indicating a potential upside of 52.58%. Given PDF Solutions’ higher possible upside, analysts plainly believe PDF Solutions is more favorable than Cicero.

Insider & Institutional Ownership

87.0% of PDF Solutions shares are owned by institutional investors. 14.7% of PDF Solutions shares are owned by company insiders. Comparatively, 89.0% of Cicero shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

PDF Solutions beats Cicero on 8 of the 10 factors compared between the two stocks.

About PDF Solutions

PDF Solutions, Inc. provides infrastructure technologies and services to enhance yield and optimize performance of integrated circuits (IC) in the United States, Germany, Taiwan, China, and internationally. It offers manufacturing process solutions; volume manufacturing solutions; design-for-inspection (DFI) solutions; and design-for-manufacturability (DFM) solutions. The company also provides Characterization Vehicle (CV) infrastructure, which includes CV test chips, pdCV analysis software, and pdFasTest electrical testers; DFI infrastructure that comprises DFI on-chip instruments, eProbe contactless E-beam tool, and Exensio –char DFI software; FIRE software, which analyzes an IC design to compute its systematic and random yield loss; and Template technology that includes Templatyzer software and IP for identifying and developing a set of layout patterns. In addition, it offers Exensio enterprise-wide platform, which consists of Exensio-Yield that collects, loads, and stores yield data in an analysis-ready database, which enables product engineers to identify and analyze production yield, performance, reliability, and other issues; Exensio-Control, which provides fault detection and classification capabilities for monitoring, alarming, and controlling manufacturing tool sets; Exensio-Test that offers testing and analysis capability; and Exensio-Char, which encapsulates test structure analysis functionality of electrical and in-line inspection data from CV test chips and DFI on-chip instruments. The company sells its technologies and services through direct sales force, solution implementation teams, and strategic alliances to integrated device manufacturers, fabless semiconductor design companies, and foundries in the microprocessors, memory, graphics, image sensor solutions, and communications segments. PDF Solutions, Inc. was founded in 1992 and is headquartered in San Jose, California.

About Cicero

Cicero Inc. provides business integration software solutions in the United States and Europe. The company's software enables organizations to integrate new and existing information and processes at the desktop; and addresses the need for a company's information systems to deliver enterprise-wide views of their business information processes. It offers Cicero Discovery, a configurable tool to collect activity and application performance data, and track business objects across time and multiple users, as well as measure against a defined expected business process flow; and Cicero Insight, a measurement and analytics solution that collects and presents information about quality, productivity, compliance, and revenue from frontline activity to target areas for improvement. The company also provides Cicero Automation that delivers features of the Cicero Discovery product, as well as desktop automation for enterprise contact center and back office employees; integrates applications and automates workflow; and control and adaptability at the end user desktop. In addition, it offers technical support, training, and consulting services. The company sells its products and services directly, as well as through distributors and other intermediaries who resell it to end-users. It serves financial services, insurance, telecommunications, and healthcare industries; and business process outsourcers, as well as intelligence, security, law enforcement, and other governmental organizations. The company was formerly known as Level 8 Systems, Inc. and changed its name to Cicero Inc. in January 2007. Cicero Inc. was founded in 1988 and is headquartered in Cary, North Carolina.

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