Critical Review: Rekor Systems (NASDAQ:REKR) & Iteris (NASDAQ:ITI)

Rekor Systems (NASDAQ:REKR) and Iteris (NASDAQ:ITI) are both small-cap business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, earnings, institutional ownership, valuation and risk.

Analyst Ratings

This is a summary of recent ratings and price targets for Rekor Systems and Iteris, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rekor Systems 0 0 0 0 N/A
Iteris 0 0 3 0 3.00

Iteris has a consensus target price of $8.50, suggesting a potential upside of 61.60%. Given Iteris’ higher possible upside, analysts plainly believe Iteris is more favorable than Rekor Systems.

Profitability

This table compares Rekor Systems and Iteris’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rekor Systems -21.22% -1,028.10% -40.03%
Iteris -7.79% -11.35% -6.99%

Valuation & Earnings

This table compares Rekor Systems and Iteris’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rekor Systems $48.56 million 1.40 -$5.70 million N/A N/A
Iteris $99.12 million 2.15 -$7.82 million ($0.11) -47.82

Rekor Systems has higher earnings, but lower revenue than Iteris.

Institutional and Insider Ownership

2.2% of Rekor Systems shares are owned by institutional investors. Comparatively, 39.4% of Iteris shares are owned by institutional investors. 51.8% of Rekor Systems shares are owned by insiders. Comparatively, 6.2% of Iteris shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Rekor Systems has a beta of 2.07, indicating that its share price is 107% more volatile than the S&P 500. Comparatively, Iteris has a beta of 0.29, indicating that its share price is 71% less volatile than the S&P 500.

Summary

Iteris beats Rekor Systems on 8 of the 11 factors compared between the two stocks.

About Rekor Systems

Rekor Systems, Inc., through its subsidiary, Rekor Recognition Systems, Inc., provides artificial intelligence and machine-learning enabled automated license plate recognition (ALPR) systems. Its ALPR systems are powered by OpenALPR software to enhance the accuracy of license plate reads to industry-leading levels, as well as to identify the make, model, and color of vehicles. The company's solutions include mobile license plate recognition (LPR) systems, fixed LPR systems, Move Over law enforcement, school bus stop-arm enforcement, red light and speed enforcement, parking enforcement, and citation management. Its products are used for law enforcement, security and surveillance, electronic toll collection, parking operations, banking and insurance, logistics, traffic management, and customer loyalty applications. The company was formerly known as Novume Solutions, Inc. and changed its name to Rekor Systems, Inc. in April 2019. Rekor Systems, Inc. was founded in 2017 and is based in Columbia, Maryland.

About Iteris

Iteris, Inc. provides intelligent transportation systems technology solutions worldwide. The company's Roadway Sensors segment provides vehicle detection sensors and systems for traffic intersection management, communication systems, and roadway traffic data collection applications. Its products include Vantage detection system to detect vehicle presence at intersections, as well as vehicle count, speed, and other traffic data; Vantage Vector video/radar hybrid product, an vehicle detection sensor; and VantageLive!, a cloud-based platform; and Vantage systems equipped with smartcycle capability to differentiate between bicycles and other vehicles with a single video detection camera. This segment also offers The SmartCycle Bike Indicator; Vantage systems with the PedTrax capability, which provides bi-directional counting and speed tracking of pedestrians; VersiCam, an integrated camera and processor video detection system; and VantageNext, VantagePegasus, VantageRadius, Velocity, SmartCycle, SmartSpan, and P-series products. Its Transportation Systems segment offers transportation engineering and consulting services with a focus on the planning, design, development, and implementation of software-based ITS systems that integrate sensors, video surveillance systems, computers, and communications equipment; and distributes real-time information about traffic conditions. This segment offers iPeMS, a transportation performance measurement and traffic analytics solution. The company's Agriculture and Weather Analytics segment offers ClearPath Weather management tools that allow users to create solutions to meet roadway maintenance decision needs; and ClearAg, a agriculture solution. The company serves smart transportation, digital agriculture, municipalities, government agencies, crop science companies, farmers, and agronomists. Iteris, Inc. was founded in 1969 and is headquartered in Santa Ana, California.

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