Reviewing Seagate Technology PLC (STX) and Synaptics (SYNA)

Seagate Technology PLC (NASDAQ: STX) and Synaptics (NASDAQ:SYNA) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitability and earnings.

Profitability

This table compares Seagate Technology PLC and Synaptics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Seagate Technology PLC 7.41% 84.50% 13.27%
Synaptics 2.84% 16.51% 9.36%

Risk & Volatility

Seagate Technology PLC has a beta of 1.72, indicating that its stock price is 72% more volatile than the S&P 500. Comparatively, Synaptics has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.

Dividends

Seagate Technology PLC pays an annual dividend of $2.52 per share and has a dividend yield of 6.8%. Synaptics does not pay a dividend. Seagate Technology PLC pays out 95.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

90.3% of Seagate Technology PLC shares are owned by institutional investors. Comparatively, 97.7% of Synaptics shares are owned by institutional investors. 0.9% of Seagate Technology PLC shares are owned by company insiders. Comparatively, 3.7% of Synaptics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Seagate Technology PLC and Synaptics’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Seagate Technology PLC $10.77 billion 0.99 $2.05 billion $2.65 13.95
Synaptics $1.72 billion 0.73 $174.50 million $1.38 26.90

Seagate Technology PLC has higher revenue and earnings than Synaptics. Seagate Technology PLC is trading at a lower price-to-earnings ratio than Synaptics, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Seagate Technology PLC and Synaptics, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Seagate Technology PLC 3 21 5 1 2.13
Synaptics 5 4 8 0 2.18

Seagate Technology PLC presently has a consensus target price of $41.65, suggesting a potential upside of 12.67%. Synaptics has a consensus target price of $51.20, suggesting a potential upside of 37.93%. Given Synaptics’ stronger consensus rating and higher possible upside, analysts plainly believe Synaptics is more favorable than Seagate Technology PLC.

Summary

Seagate Technology PLC beats Synaptics on 10 of the 17 factors compared between the two stocks.

Seagate Technology PLC Company Profile

Seagate Technology public limited company is a provider of electronic data storage technology and solutions. The Company’s principal products are hard disk drives (HDDs). In addition to HDDs, it produces a range of electronic data storage products, including solid state hybrid drives, solid state drives, peripheral component interconnect express (PCIe) cards and serial advanced technology architecture (SATA) controllers. Its storage technology portfolio also includes storage subsystems and high performance computing solutions. Its products are designed for applications in enterprise servers and storage systems, client compute applications and client non-compute applications. It designs, fabricates and assembles various components found in its disk drives, including read/write heads and recording media. Its design and manufacturing operations are based on technology platforms that are used to produce various disk drive products that serve multiple data storage applications and markets.

Synaptics Company Profile

Synaptics Incorporated is engaged in the development, marketing and sale of intuitive human interface solutions for electronic devices and products. The Company is a developer and supplier of custom-designed human interface product solutions that enable people to interact with a range of mobile computing, communications, entertainment and other electronic devices. Its products include ClearPad, ClearView, TouchView, Natural ID, TouchPad, SecurePad, ClickPad and ForcePad. Its other product solutions include dual pointing solutions, TouchStyk, and TouchButtons. Its dual pointing solutions offer TouchPad with a pointing stick in a single notebook computer, enabling users to select their interface of choice. TouchStyk is a self-contained pointing stick module that uses capacitive technology similar to that used in its TouchPad. TouchButtons provide capacitive buttons and scrolling controls for an interface solution designed to replace mechanical buttons.

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