Function(x) (OTCMKTS: FNCX) and Dolby Laboratories (NYSE:DLB) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, earnings, risk, valuation, analyst recommendations and institutional ownership.

Institutional & Insider Ownership

0.0% of Function(x) shares are owned by institutional investors. Comparatively, 52.5% of Dolby Laboratories shares are owned by institutional investors. 60.5% of Function(x) shares are owned by insiders. Comparatively, 43.8% of Dolby Laboratories shares are owned by 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.

Analyst Recommendations

This is a summary of current ratings and price targets for Function(x) and Dolby Laboratories, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Function(x) 0 0 0 0 N/A
Dolby Laboratories 0 1 2 0 2.67

Dolby Laboratories has a consensus price target of $60.17, indicating a potential downside of 2.63%. Given Dolby Laboratories’ higher possible upside, analysts clearly believe Dolby Laboratories is more favorable than Function(x).

Dividends

Dolby Laboratories pays an annual dividend of $0.64 per share and has a dividend yield of 1.0%. Function(x) does not pay a dividend. Dolby Laboratories pays out 33.0% of its earnings in the form of a dividend. Function(x) has increased its dividend for 2 consecutive years.

Profitability

This table compares Function(x) and Dolby Laboratories’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Function(x) N/A N/A N/A
Dolby Laboratories 18.66% 10.62% 9.07%

Risk & Volatility

Function(x) has a beta of -0.65, indicating that its stock price is 165% less volatile than the S&P 500. Comparatively, Dolby Laboratories has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500.

Valuation & Earnings

This table compares Function(x) and Dolby Laboratories’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Function(x) $4.51 million 0.39 -$61.86 million N/A N/A
Dolby Laboratories $1.08 billion 5.84 $201.80 million $1.94 31.85

Dolby Laboratories has higher revenue and earnings than Function(x).

Summary

Dolby Laboratories beats Function(x) on 11 of the 14 factors compared between the two stocks.

Function(x) Company Profile

Function(x) Inc., formerly DraftDay Fantasy Sports, Inc., is a diversified media and entertainment company. The Company conducts three lines of businesses, which are digital publishing through Wetpaint.com, Inc. (Wetpaint) and Rant, Inc. (Rant); fantasy sports gaming through DraftDay Gaming Group, Inc. (DDGG), and digital content distribution through Choose Digital, Inc. (Choose Digital). The Company’s segments include Wetpaint, which is a media channel reporting original news stories and publishing information content covering television shows, music, celebrities, entertainment news and fashion; Choose Digital, which is a business-to-business platform for delivering digital content; DDGG, which is a business-to-business operator of daily fantasy sports, and Other. The Company’s digital publishing business also includes Rant, which is a digital publisher that publishes original content in over 13 verticals, such as in sports, entertainment, pets, cars and food.

Dolby Laboratories Company Profile

Dolby Laboratories, Inc. designs and manufactures audio and imaging products for the cinema, television, broadcast and entertainment industries. Its products for cinema include Digital Cinema Servers and Cinema Audio Products, and broadcast and other include Dolby Conference Phone and Other Products. It offers services to support theatrical and television production for cinema exhibition, broadcast and home entertainment, including equipment training and maintenance, mixing room alignment and equalization, as well as audio, color and light image calibration. Its technologies include Advanced Audio Coding and High Efficiency Advanced Audio Coding, Dolby AC-4, Dolby Atmos, Dolby Digital, Dolby Digital Plus, Dolby TrueHD, Dolby Vision, Dolby Voice and High Efficiency Video Coding. It distributes its products in over 80 countries. Its technologies are incorporated in offerings in various end markets, such as the broadcast, Personal Computer, mobile, consumer electronics and other markets.

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