Nimble Storage (NYSE: NMBL) and Western Digital Corporation (NASDAQ:WDC) are both technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, earnings, risk, valuation, analyst recommendations, profitabiliy and institutional ownership.

Volatility & Risk

Nimble Storage has a beta of 1.78, indicating that its stock price is 78% more volatile than the S&P 500. Comparatively, Western Digital Corporation has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500.

Institutional and Insider Ownership

63.4% of Nimble Storage shares are owned by institutional investors. Comparatively, 82.6% of Western Digital Corporation shares are owned by institutional investors. 20.9% of Nimble Storage shares are owned by insiders. Comparatively, 0.5% of Western Digital Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Nimble Storage and Western Digital Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nimble Storage 0 16 3 0 2.16
Western Digital Corporation 0 5 28 1 2.88

Nimble Storage currently has a consensus target price of $12.65, indicating a potential upside of 1.31%. Western Digital Corporation has a consensus target price of $105.66, indicating a potential upside of 30.17%. Given Western Digital Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Western Digital Corporation is more favorable than Nimble Storage.

Dividends

Western Digital Corporation pays an annual dividend of $2.00 per share and has a dividend yield of 2.5%. Nimble Storage does not pay a dividend. Western Digital Corporation pays out 156.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Nimble Storage and Western Digital Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Nimble Storage N/A N/A N/A ($1.83) -6.83
Western Digital Corporation $19.09 billion 1.24 $4.40 billion $1.28 63.41

Western Digital Corporation has higher revenue and earnings than Nimble Storage. Nimble Storage is trading at a lower price-to-earnings ratio than Western Digital Corporation, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nimble Storage and Western Digital Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nimble Storage -31.11% -130.73% -44.52%
Western Digital Corporation 2.08% 21.23% 7.96%

Summary

Western Digital Corporation beats Nimble Storage on 11 of the 14 factors compared between the two stocks.

Nimble Storage Company Profile

Nimble Storage, Inc. (Nimble Storage) focuses on providing its end-customers with data. The Company’s Predictive Cloud Platform combines predictive analytics, flash storage and multicloud infrastructure to manage operations in on-premises data centers and in the cloud. Its products allow end-customers to deploy workloads flexibly on flash arrays, converged infrastructure and the public cloud. Its operating system includes NimbleOS. NimbleOS runs across all of its All Flash and Adaptive Flash (Hybrid) arrays and powers Nimble Cloud Volumes. The features of NimbleOS include Cache Accelerated Sequential Layout (CASL), Variable Block Inline Deduplication, Variable Block Inline Compression, Efficient All Flash Array Architecture, Dynamic Caching for Adaptive Flash Arrays, Efficient, Instant Snapshots and Replication, SmartSecure Encryption and Data Shredding and Scalability.

Western Digital Corporation Company Profile

Western Digital Corporation (Western Digital) is a developer, manufacturer and provider of data storage devices and solutions that address the needs of the information technology (IT) industry and the infrastructure that enables the proliferation of data in virtually every industry. The Company’s portfolio of offerings addresses three categories: Datacenter Devices and Solutions (capacity and performance enterprise hard disk drives (HDDs), enterprise solid state drives (SSDs), datacenter software and system solutions); Client Devices (mobile, desktop, gaming and digital video hard drives, client SSDs, embedded products and wafers), and Client Solutions (removable products, hard drive content solutions and flash content solutions). The Company develops and manufactures a portion of the recording heads and magnetic media used in its hard drive products.

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