Critical Contrast: EMC (EMC) and Silicon Graphics International Corp (SGI)

EMC (NYSE: EMC) and Silicon Graphics International Corp (NASDAQ:SGI) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, profitability, earnings and dividends.

Volatility and Risk

EMC has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, Silicon Graphics International Corp has a beta of 1.98, meaning that its share price is 98% more volatile than the S&P 500.

Profitability

This table compares EMC and Silicon Graphics International Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
EMC 10.47% 10.66% 5.47%
Silicon Graphics International Corp 0.11% 0.98% 0.15%

Analyst Ratings

This is a summary of current recommendations for EMC and Silicon Graphics International Corp, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
EMC 0 4 1 0 2.20
Silicon Graphics International Corp 0 0 1 0 3.00

EMC currently has a consensus target price of $29.00, suggesting a potential downside of 0.17%. Silicon Graphics International Corp has a consensus target price of $7.75, suggesting a potential upside of 0.00%. Given Silicon Graphics International Corp’s stronger consensus rating and higher probable upside, analysts plainly believe Silicon Graphics International Corp is more favorable than EMC.

Insider & Institutional Ownership

79.9% of EMC shares are held by institutional investors. Comparatively, 80.9% of Silicon Graphics International Corp shares are held by institutional investors. 0.4% of EMC shares are held by insiders. Comparatively, 3.9% of Silicon Graphics International Corp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares EMC and Silicon Graphics International Corp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
EMC N/A N/A N/A $1.07 27.15
Silicon Graphics International Corp N/A N/A N/A ($0.32) -24.22

Silicon Graphics International Corp is trading at a lower price-to-earnings ratio than EMC, indicating that it is currently the more affordable of the two stocks.

Dividends

EMC pays an annual dividend of $0.46 per share and has a dividend yield of 1.6%. Silicon Graphics International Corp does not pay a dividend. EMC pays out 43.0% of its earnings in the form of a dividend. EMC has increased its dividend for 3 consecutive years.

EMC Company Profile

EMC Corporation (EMC) develops, delivers and supports the information technology (IT) industry’s range of information infrastructure and virtual infrastructure technologies, solutions and services. EMC manages the Company as part of a federation of businesses: EMC Information Infrastructure, VMware Virtual Infrastructure, Pivotal and Virtustream. EMC’s Information Infrastructure business provides a foundation for organizations to store, manage, protect, analyze and secure information. EMC’s VMware Virtual Infrastructure business is engaged in virtualization and cloud infrastructure solutions that enable businesses to help transform the way they build, deliver and consume IT resources in a manner that is based on their specific needs. EMC’s Pivotal business unites strategic technology, people and programs from EMC and VMware and has a platform that consists of data, agile development practices and a cloud independent platform-as-a-service.

Silicon Graphics International Corp Company Profile

Silicon Graphics International Corp. (SGI) is engaged in providing solutions for compute, data analytics and data management. The Company develops, markets and sells a line of mid-range and high-end scale-out and scale-up servers, enterprise-class storage, differentiating software and designed-to-order solutions for data center deployments. The Company operates through the segments, including Product and Service. The Company’s Product segment consists of compute and storage solutions, which include products from both HPC and HPDA segments. The Company’s Product segment includes scale-out computing, scale-up computing, software and cloud/Web solutions. Its storage solutions include both hardware and software offerings for data storage and management. The Service segment consists of customer service support and professional services. SGI systems enable customers to access, analyze, transform, manage and visualize information in real and near real-time.

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