Seagate Technology (NASDAQ:STX) and Analog Devices (NASDAQ:ADI) are both large-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, profitability, analyst recommendations and valuation.
Dividends
Seagate Technology pays an annual dividend of $2.68 per share and has a dividend yield of 3.7%. Analog Devices pays an annual dividend of $2.76 per share and has a dividend yield of 1.9%. Seagate Technology pays out 58.6% of its earnings in the form of a dividend. Analog Devices pays out 56.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Seagate Technology has raised its dividend for 1 consecutive years and Analog Devices has raised its dividend for 1 consecutive years.
Insider & Institutional Ownership
82.5% of Seagate Technology shares are held by institutional investors. Comparatively, 91.9% of Analog Devices shares are held by institutional investors. 1.0% of Seagate Technology shares are held by company insiders. Comparatively, 0.4% of Analog Devices shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Seagate Technology and Analog Devices' gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Seagate Technology | $10.51 billion | 1.65 | $1.00 billion | $4.57 | 16.06 |
| Analog Devices | $5.60 billion | 9.80 | $1.22 billion | $4.91 | 30.32 |
Analog Devices has lower revenue, but higher earnings than Seagate Technology. Seagate Technology is trading at a lower price-to-earnings ratio than Analog Devices, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Seagate Technology has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, Analog Devices has a beta of 1.31, indicating that its stock price is 31% more volatile than the S&P 500.
Profitability
This table compares Seagate Technology and Analog Devices' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Seagate Technology | 10.02% | 65.10% | 13.24% |
| Analog Devices | 21.79% | 15.51% | 8.50% |
Analyst Ratings
This is a summary of recent ratings for Seagate Technology and Analog Devices, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Seagate Technology | 3 | 11 | 10 | 0 | 2.29 |
| Analog Devices | 0 | 7 | 17 | 0 | 2.71 |
Seagate Technology presently has a consensus price target of $67.2727, indicating a potential downside of 8.32%. Analog Devices has a consensus price target of $154.50, indicating a potential upside of 3.77%. Given Analog Devices' stronger consensus rating and higher possible upside, analysts clearly believe Analog Devices is more favorable than Seagate Technology.
Summary
Analog Devices beats Seagate Technology on 11 of the 16 factors compared between the two stocks.
