Harris (NYSE: HRS) and Digi International (NASDAQ:DGII) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.
Volatility and Risk
Harris has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500. Comparatively, Digi International has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500.
This is a breakdown of current ratings and target prices for Harris and Digi International, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Harris presently has a consensus target price of $144.17, suggesting a potential upside of 0.66%. Digi International has a consensus target price of $14.50, suggesting a potential upside of 51.04%. Given Digi International’s stronger consensus rating and higher probable upside, analysts plainly believe Digi International is more favorable than Harris.
This table compares Harris and Digi International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Harris and Digi International’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Harris||$5.90 billion||2.89||$553.00 million||$4.48||31.97|
|Digi International||$181.63 million||1.42||$9.36 million||$0.35||27.43|
Harris has higher revenue and earnings than Digi International. Digi International is trading at a lower price-to-earnings ratio than Harris, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
84.3% of Harris shares are owned by institutional investors. Comparatively, 77.4% of Digi International shares are owned by institutional investors. 1.9% of Harris shares are owned by company insiders. Comparatively, 6.8% of Digi International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Harris pays an annual dividend of $2.28 per share and has a dividend yield of 1.6%. Digi International does not pay a dividend. Harris pays out 50.9% of its earnings in the form of a dividend. Harris has raised its dividend for 15 consecutive years.
Harris beats Digi International on 12 of the 17 factors compared between the two stocks.
Harris Corporation is a technology company that provides products, systems and services that have defense and civil government applications, as well as commercial applications. It offers its products and services to government and commercial customer. It operates in four segments: Communication Systems, which serves markets in tactical communications and defense, and public safety networks; Space and Intelligence Systems, which provides complete Earth observation, environmental, geospatial, space protection, and intelligence solutions from advanced sensors and payloads, as well as ground processing and information analytics; Electronic Systems, which offers a portfolio of solutions in electronic warfare, avionics, wireless and technology, among others, and Critical Networks, which provides managed services supporting air traffic management, energy and maritime communications, and ground network operation and sustainment, as well as information technology (IT) and engineering services.
About Digi International
Digi International Inc. is a provider of mission and business-critical machine-to-machine (M2M) and Internet-of-Things (IoT) connectivity products and services. The Company creates connected products and deploys and manages critical communications infrastructures in a range of environments. It offers four categories of hardware products: cellular routers and gateways, radio frequency (RF), embedded and network products. The Company’s cellular product category includes its cellular routers and all gateways. The Company’s RF product category includes its XBee modules, as well as other RF Solutions. Its embedded product category includes Digi Connect and Rabbit embedded systems on module and single board computers. Its network product category includes console and serial servers and universal serial bus (USB) connected products. The Company’s service offerings include wireless design services, Digi Device Cloud (which includes Digi Remote Manager) and enterprise support services.
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