Synaptics (NASDAQ: SYNA) and Apple (NASDAQ:AAPL) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Synaptics and Apple, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Synaptics 5 4 7 0 2.13
Apple 0 9 39 0 2.81

Synaptics presently has a consensus target price of $51.07, indicating a potential upside of 35.40%. Apple has a consensus target price of $191.76, indicating a potential upside of 22.92%. Given Synaptics’ higher possible upside, analysts plainly believe Synaptics is more favorable than Apple.

Dividends

Apple pays an annual dividend of $2.52 per share and has a dividend yield of 1.6%. Synaptics does not pay a dividend. Apple pays out 28.6% of its earnings in the form of a dividend. Apple has raised its dividend for 4 consecutive years.

Earnings and Valuation

This table compares Synaptics and Apple’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Synaptics $1.72 billion 0.74 $174.50 million $1.38 27.33
Apple $223.51 billion 3.61 $70.21 billion $8.80 17.73

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

Risk and Volatility

Synaptics has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500. Comparatively, Apple has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.

Profitability

This table compares Synaptics and Apple’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Synaptics 2.84% 16.51% 9.36%
Apple 20.87% 35.40% 14.00%

Institutional and Insider Ownership

97.7% of Synaptics shares are owned by institutional investors. Comparatively, 60.4% of Apple shares are owned by institutional investors. 3.7% of Synaptics shares are owned by company insiders. Comparatively, 0.1% of Apple shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Apple beats Synaptics on 12 of the 17 factors compared between the two stocks.

About Synaptics

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.

About Apple

Apple Inc. (Apple) designs, manufactures and markets mobile communication and media devices, personal computers, and portable digital music players, and a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications. The Company’s products and services include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X operating systems, iCloud, and a variety of accessory, service and support offerings. The Company also delivers digital content and applications through the iTunes Store, App StoreSM, iBookstoreSM, and Mac App Store. The Company distributes its products worldwide through its retail stores, online stores, and direct sales force, as well as through third-party cellular network carriers, wholesalers, retailers, and value-added resellers. In February 2012, the Company acquired app-search engine Chomp.

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