Choosing the right technology stock for your portfolio often means comparing companies with overlapping markets and innovation strategies. Fabrinet (FN) excels in precision optical and electro-mechanical manufacturing, serving diverse sectors from telecommunications to medical devices. Ouster, Inc. (OUST) pioneers in high-resolution digital lidar sensors, focusing on 3D vision for vehicles and robotics. This article will help you determine which company offers the most compelling investment opportunity in 2026.
Table of contents
Companies Overview
I will begin the comparison between Fabrinet and Ouster, Inc. by providing an overview of these two companies and their main differences.
Fabrinet Overview
Fabrinet specializes in optical packaging and precision manufacturing services across North America, Asia-Pacific, and Europe. Its offerings include advanced optical and electro-mechanical capabilities such as process design, supply chain management, assembly, and testing. The company serves original equipment manufacturers in optical communication, industrial lasers, automotive components, medical devices, and sensors, positioning itself as a key player in high-precision hardware manufacturing.
Ouster, Inc. Overview
Ouster, Inc. designs and manufactures high-resolution digital lidar sensors and software that provide 3D vision to machinery, vehicles, robots, and fixed infrastructure. The company’s product portfolio includes scanning and solid-state flash sensors. Based in San Francisco, Ouster operates in the technology sector with a focus on innovative lidar solutions for multiple industries, reflecting a specialized approach within the hardware equipment market.
Key similarities and differences
Both Fabrinet and Ouster operate in the hardware, equipment, and parts industry within the technology sector. Fabrinet focuses broadly on precision manufacturing of optical and electro-mechanical components for various sectors, while Ouster concentrates on digital lidar sensor technology and software. Fabrinet has a significantly larger workforce and market capitalization compared to Ouster, indicating differences in scale and market reach despite their shared industry focus.
Income Statement Comparison
Below is a side-by-side comparison of key income statement metrics for Fabrinet and Ouster, Inc. for their most recent fiscal years.
| Metric | Fabrinet (FN) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Cap | 16.8B | 1.63B |
| Revenue | 3.42B | 111M |
| EBITDA | 409M | -80M |
| EBIT | 355M | -95M |
| Net Income | 333M | -97M |
| EPS | 9.23 | -2.08 |
| Fiscal Year | 2025 | 2024 |
Income Statement Interpretations
Fabrinet
Fabrinet’s revenue grew steadily from $1.88B in 2021 to $3.42B in 2025, reflecting an 81.94% increase over five years. Net income nearly doubled, reaching $333M in 2025. Margins remained stable with a gross margin around 12% and a favorable EBIT margin of 10.39%. The latest year showed strong revenue growth of 18.6%, though net margin slipped slightly by 5.34%.
Ouster, Inc.
Ouster reported rapid revenue growth from $34M in 2021 to $111M in 2024, a 487.71% increase overall. Despite this, the company posted net losses each year, with a net loss of $97M in 2024. Margins fluctuated significantly; gross margin was favorable at 36.42%, but EBIT and net margins remained deeply negative. Recent growth accelerated with a 33.41% revenue increase and improved net margin.
Which one has the stronger fundamentals?
Fabrinet demonstrates stronger fundamentals with consistent profitability, positive net and EBIT margins, and sustained growth, despite a slight net margin dip recently. Ouster shows impressive top-line growth but continues to operate at a loss with negative margins. The stability and profitability of Fabrinet suggest a more favorable income statement profile compared to Ouster’s ongoing losses.
Financial Ratios Comparison
The table below presents the most recent available financial ratios for Fabrinet and Ouster, Inc., offering a concise comparison of key performance and financial health metrics for fiscal year 2025 and 2024 respectively.
| Ratios | Fabrinet (2025) | Ouster, Inc. (2024) |
|---|---|---|
| ROE | 16.8% | -53.6% |
| ROIC | 15.0% | -50.8% |
| P/E | 32.0 | -5.87 |
| P/B | 5.37 | 3.15 |
| Current Ratio | 3.00 | 2.80 |
| Quick Ratio | 2.28 | 2.59 |
| D/E | 0.003 | 0.112 |
| Debt-to-Assets | 0.19% | 7.33% |
| Interest Coverage | 0 | -57.1 |
| Asset Turnover | 1.21 | 0.40 |
| Fixed Asset Turnover | 8.85 | 4.54 |
| Payout Ratio | 0% | 0% |
| Dividend Yield | 0% | 0% |
Interpretation of the Ratios
Fabrinet
Fabrinet displays generally strong financial ratios, with favorable returns on equity (16.78%) and invested capital (15.01%), alongside a solid current ratio of 3.0, indicating good liquidity. However, valuation multiples like P/E (32.02) and P/B (5.37) are less attractive. The company does not pay dividends, likely favoring reinvestment or growth strategies.
Ouster, Inc.
Ouster, Inc. shows weak financial health, with negative returns on equity (-53.64%) and invested capital (-50.84%), and a high weighted average cost of capital (17.47%). Despite decent liquidity ratios, the firm reports no dividends, consistent with its negative profitability and probable focus on R&D and expansion in a high-growth phase.
Which one has the best ratios?
Fabrinet has the best ratios overall, exhibiting stronger profitability, liquidity, and capital efficiency metrics. Ouster’s unfavorable returns and higher risk profile reflect challenges in profitability and cash flow. Fabrinet’s favorable ratio majority contrasts with Ouster’s predominantly unfavorable financial indicators.
Strategic Positioning
This section compares the strategic positioning of Fabrinet and Ouster, Inc. regarding Market position, Key segments, and exposure to technological disruption:
Fabrinet
- Established global player in optical manufacturing with $16.8B market cap and moderate beta.
- Key segments include optical communications ($2.6B revenue) and lasers, sensors, and others.
- Operates in mature optical and electro-mechanical manufacturing with moderate disruption risk.
Ouster, Inc.
- Smaller firm focused on high-resolution digital lidar with $1.6B market cap and higher volatility.
- Single segment focusing on digital lidar sensors and software, generating $111M revenue in 2024.
- Faces technological disruption from evolving lidar and 3D sensing technologies in robotics.
Fabrinet vs Ouster, Inc. Positioning
Fabrinet has a diversified portfolio centered on optical communications and various sensors, benefiting from scale and established markets. Ouster concentrates on innovative lidar technology with smaller scale and higher risk exposure, focusing on emerging 3D vision applications.
Which has the best competitive advantage?
Fabrinet shows a very favorable moat with ROIC well above WACC and growing profitability, indicating a durable competitive advantage. Ouster has a slightly unfavorable moat, shedding value despite improving profitability.
Stock Comparison
The stock price chart highlights significant bullish gains for both Fabrinet and Ouster, Inc. over the past year, with Fabrinet showing accelerating momentum and Ouster experiencing a recent deceleration phase.
Trend Analysis
Fabrinet’s stock price rose 135.21% over the past 12 months, reflecting a bullish trend with accelerating momentum. Price volatility is high, shown by an 85.45 standard deviation and a range between 162.32 and 479.42.
Ouster, Inc. achieved a 407.45% price increase over the same period, indicating a bullish trend despite recent deceleration. Its lower volatility, with an 8.61 standard deviation, contrasts with a significant recent decline of 18.32%.
Comparing both, Ouster delivered the highest market performance over the year, though Fabrinet demonstrates accelerating gains and higher recent buyer dominance.
Target Prices
The current analyst target price consensus suggests potential upside for both Fabrinet and Ouster, Inc.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Fabrinet | 600 | 537 | 568.5 |
| Ouster, Inc. | 39 | 33 | 36.67 |
Analysts expect Fabrinet’s price to rise from its current 469 to around 568.5, indicating moderate upside potential. Ouster’s consensus target at 36.67 also suggests a significant increase above its present price near 27.1.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Fabrinet and Ouster, Inc.:
Rating Comparison
Fabrinet Rating
- Rating: A- indicating a very favorable overall evaluation.
- Discounted Cash Flow Score: 3, a moderate indication of valuation.
- ROE Score: 4, showing favorable profit generation efficiency.
- ROA Score: 5, very favorable asset utilization.
- Debt To Equity Score: 5, indicating very favorable financial stability.
- Overall Score: 4, a favorable summary financial standing.
Ouster, Inc. Rating
- Rating: C- reflecting a very unfavorable overall view.
- Discounted Cash Flow Score: 1, very unfavorable valuation.
- ROE Score: 1, very unfavorable profit generation efficiency.
- ROA Score: 1, very unfavorable asset utilization.
- Debt To Equity Score: 3, moderate financial risk.
- Overall Score: 1, a very unfavorable financial standing.
Which one is the best rated?
Based strictly on the provided data, Fabrinet is clearly better rated than Ouster, Inc., with superior scores in overall rating, cash flow, profitability, asset use, and financial stability.
Scores Comparison
Here is the comparison of Fabrinet and Ouster, Inc. scores based on financial stability and strength:
Fabrinet Scores
- Altman Z-Score: 13.79, indicating a strong safe zone status
- Piotroski Score: 4, classified as average financial strength
Ouster, Inc. Scores
- Altman Z-Score: 3.66, indicating a safe zone status
- Piotroski Score: 4, classified as average financial strength
Which company has the best scores?
Fabrinet shows a significantly higher Altman Z-Score, placing it well within the safe zone, while both companies share the same average Piotroski Score of 4. Therefore, Fabrinet has the stronger overall scores based on the data provided.
Grades Comparison
Here is a detailed comparison of the recent grades assigned to Fabrinet and Ouster, Inc.:
Fabrinet Grades
The following table presents recent reliable grades issued by leading financial institutions for Fabrinet:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Barclays | Maintain | Equal Weight | 2025-11-05 |
| Needham | Maintain | Buy | 2025-11-04 |
| JP Morgan | Maintain | Overweight | 2025-11-04 |
| Rosenblatt | Maintain | Buy | 2025-11-04 |
| JP Morgan | Maintain | Overweight | 2025-10-16 |
| Rosenblatt | Maintain | Buy | 2025-10-02 |
| JP Morgan | Upgrade | Overweight | 2025-08-25 |
| B. Riley Securities | Maintain | Neutral | 2025-08-19 |
| Needham | Maintain | Buy | 2025-08-19 |
| Rosenblatt | Maintain | Buy | 2025-08-19 |
Fabrinet’s grades show a consistent buy or overweight stance with occasional neutral ratings, reflecting stable analyst confidence.
Ouster, Inc. Grades
Below is the summary of recent reliable grades from reputable grading firms for Ouster, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Cantor Fitzgerald | Upgrade | Overweight | 2025-11-07 |
| Cantor Fitzgerald | Upgrade | Overweight | 2025-11-06 |
| WestPark Capital | Maintain | Buy | 2025-11-05 |
| Rosenblatt | Maintain | Buy | 2025-11-05 |
| WestPark Capital | Upgrade | Buy | 2025-08-13 |
| Oppenheimer | Maintain | Outperform | 2025-07-16 |
| WestPark Capital | Downgrade | Hold | 2025-06-12 |
| WestPark Capital | Upgrade | Buy | 2025-05-09 |
| Rosenblatt | Maintain | Buy | 2025-03-21 |
| Cantor Fitzgerald | Maintain | Overweight | 2025-03-21 |
Ouster, Inc. displays a positive trend with multiple upgrades and a majority of buy and overweight ratings, despite a brief downgrade to hold.
Which company has the best grades?
Both Fabrinet and Ouster, Inc. hold a consensus rating of “Buy.” Fabrinet’s grades are more consistently buy or overweight with fewer fluctuations, while Ouster exhibits more upgrades and a slightly broader range of opinions. The steadier grades for Fabrinet may imply a more stable outlook, whereas Ouster’s upgrades suggest growing optimism that investors should monitor carefully.
Strengths and Weaknesses
Below is a comparative table highlighting key strengths and weaknesses of Fabrinet and Ouster, Inc. based on their latest financial and market data.
| Criterion | Fabrinet (FN) | Ouster, Inc. (OUST) |
|---|---|---|
| Diversification | Moderate focus on Optical Communications and Sensors, steady revenue growth in core segments | Limited diversification, single reportable segment with smaller revenue base |
| Profitability | Favorable ROIC of 15.0%, positive net margin 9.72%, strong ROE at 16.78% | Negative ROIC (-50.8%), net margin deeply negative (-87.35%), negative ROE |
| Innovation | Established in optical tech with steady investment in sensors and lasers | Emerging tech in lidar sensors, showing innovation potential but unprofitable |
| Global presence | Strong global client base in communications industry | Smaller scale, growing presence primarily in niche lidar market |
| Market Share | Leading provider in optical communications manufacturing | Niche player in lidar, still expanding market share |
Fabrinet demonstrates solid profitability, efficient capital use, and a durable competitive advantage, making it a more stable choice. Ouster shows promising innovation and growth potential but currently struggles with profitability and scale, posing higher risk for investors.
Risk Analysis
Below is a table summarizing key risk factors for Fabrinet (FN) and Ouster, Inc. (OUST) based on the most recent data from 2025 and 2024 respectively:
| Metric | Fabrinet (FN) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Risk | Moderate (Beta 1.035) | High (Beta 2.935) |
| Debt Level | Very Low (D/E 0.0) | Low (D/E 0.11) |
| Regulatory Risk | Moderate (Global operations) | Moderate (US tech sector) |
| Operational Risk | Low (Strong asset turnover) | Moderate (Smaller scale, new tech) |
| Environmental Risk | Moderate (Manufacturing impacts) | Moderate (Tech hardware) |
| Geopolitical Risk | Moderate (Asia-Pacific exposure) | Low (US-based) |
Fabrinet’s risks are mainly moderate market and geopolitical exposure with very low debt, reflecting stable financial footing. Ouster faces higher market risk due to its volatile beta and operational risks linked to its emerging technology status. Both companies maintain moderate regulatory and environmental risks, but Ouster’s financial metrics indicate higher risk overall.
Which Stock to Choose?
Fabrinet (FN) shows a favorable income evolution with 18.6% revenue growth in 2025 and a 9.72% net margin. Its financial ratios are mostly favorable, highlighted by a 16.78% ROE and strong liquidity, low debt, and a very favorable overall rating of A-. The company demonstrates a very favorable moat with ROIC exceeding WACC and growing profitability.
Ouster, Inc. (OUST) posts strong revenue growth of 33.41% in 2024 but suffers from negative profitability, with an -87.35% net margin and unfavorable financial ratios, including a negative ROE and interest coverage. Despite some liquidity strengths and a favorable P/E score, its overall rating is C- and its moat evaluation is slightly unfavorable due to value destruction, though profitability is improving.
Investors seeking stable profitability and quality might find Fabrinet’s strong financial health and durable competitive advantage more aligned with their goals, while those with a tolerance for risk and focus on rapid growth could view Ouster’s revenue acceleration and improving profitability as potential opportunities. Ultimately, the choice may appear to depend on the investor’s risk profile and investment strategy.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Fabrinet and Ouster, Inc. to enhance your investment decisions:
