Critical Contrast: Linear Technology (LLTC) versus Its Rivals

Linear Technology (NASDAQ: LLTC) is one of 100 public companies in the “Semiconductors” industry, but how does it contrast to its competitors? We will compare Linear Technology to similar businesses based on the strength of its institutional ownership, analyst recommendations, risk, profitability, earnings, dividends and valuation.

Risk & Volatility

Linear Technology has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500. Comparatively, Linear Technology’s competitors have a beta of 1.02, indicating that their average stock price is 2% more volatile than the S&P 500.

Dividends

Linear Technology pays an annual dividend of $1.32 per share and has a dividend yield of 2.0%. Linear Technology pays out 64.7% of its earnings in the form of a dividend. As a group, “Semiconductors” companies pay a dividend yield of 1.6% and pay out 58.2% of their earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Linear Technology and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Linear Technology 0 3 0 0 2.00
Linear Technology Competitors 950 4795 8776 369 2.58

Linear Technology currently has a consensus target price of $63.00, suggesting a potential downside of 3.08%. As a group, “Semiconductors” companies have a potential upside of 13.53%. Given Linear Technology’s competitors stronger consensus rating and higher probable upside, analysts clearly believe Linear Technology has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares Linear Technology and its competitors gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Linear Technology N/A N/A 31.86
Linear Technology Competitors $4.38 billion $573.56 million 41.48

Linear Technology’s competitors have higher revenue and earnings than Linear Technology. Linear Technology is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Linear Technology and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Linear Technology 32.99% 26.98% 23.04%
Linear Technology Competitors -43.33% 1.46% 0.93%

Insider & Institutional Ownership

90.2% of Linear Technology shares are held by institutional investors. Comparatively, 66.3% of shares of all “Semiconductors” companies are held by institutional investors. 1.2% of Linear Technology shares are held by insiders. Comparatively, 6.2% of shares of all “Semiconductors” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Linear Technology competitors beat Linear Technology on 8 of the 14 factors compared.

Linear Technology Company Profile

Linear Technology Corporation is engaged in designing, manufacturing and marketing a line of analog integrated circuits. The Company produces power management, data conversion, signal conditioning, radio frequency (RF) and interface integrated circuits (ICs) and wireless sensor network products, among others. The Company’s principal product categories include amplifiers, high speed amplifiers, voltage regulators, voltage references, interfaces, data converters, battery stack monitors, silicon oscillators and timer blox, phase locked loop (PLL) synthesizers and clock distribution, SmartMesh embedded wireless sensor network, radio and microwave frequency circuits, Power Over Ethernet (PoE) Controllers, and Other. The Company’s products provide a bridge between analog world and the digital electronics in communications, networking, industrial, transportation, computer, medical, instrumentation, consumer, and military and aerospace systems.

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