Plantronics (NYSE: PLT) and Riverbed Technology (NASDAQ:RVBD) are both communications & networking – nec companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Dividends

Plantronics pays an annual dividend of $0.60 per share and has a dividend yield of 1.2%. Riverbed Technology does not pay a dividend. Plantronics pays out 24.6% of its earnings in the form of a dividend.

Institutional & Insider Ownership

90.9% of Plantronics shares are held by institutional investors. 3.2% of Plantronics shares are held 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.

Analyst Ratings

This is a summary of current ratings and recommmendations for Plantronics and Riverbed Technology, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Plantronics 0 1 2 0 2.67
Riverbed Technology 0 0 0 0 N/A

Plantronics presently has a consensus price target of $57.33, suggesting a potential upside of 11.87%. Given Plantronics’ higher possible upside, equities analysts plainly believe Plantronics is more favorable than Riverbed Technology.

Volatility and Risk

Plantronics has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500. Comparatively, Riverbed Technology has a beta of 2.02, indicating that its stock price is 102% more volatile than the S&P 500.

Valuation and Earnings

This table compares Plantronics and Riverbed Technology’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Plantronics $881.18 million 1.92 $82.59 million $2.44 21.00
Riverbed Technology N/A N/A N/A $0.44 47.70

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

Profitability

This table compares Plantronics and Riverbed Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Plantronics 9.41% 20.12% 7.54%
Riverbed Technology 17.55% 24.83% 10.64%

Summary

Plantronics beats Riverbed Technology on 7 of the 13 factors compared between the two stocks.

Plantronics Company Profile

Plantronics, Inc. (Plantronics) is engaged in the design, manufacture, and distribution of headsets for business and consumer applications, and other specialty products for the hearing impaired. The Company is a global designer, manufacturer and marketer of communications headsets, telephone headset systems, other communication endpoints and accessories for the business and consumer markets. The Company develops communication products for offices and contact centers, mobile devices, cordless phones, and computers and gaming consoles. Its product categories include Enterprise, which includes corded and cordless communication headsets, audio processors, and telephone systems, and Consumer, which includes Bluetooth and corded products for mobile device applications, personal computer (PC) and gaming headsets, and specialty products marketed for hearing impaired individuals. It offers its products under two brands: Plantronics and Clarity.

Riverbed Technology Company Profile

Riverbed Technology, Inc. (Riverbed) is a provider of application performance infrastructure. The Company offers a platform to deliver, control and optimize IT resources across the hybrid enterprise. The Riverbed Application Performance Platform delivers application performance infrastructure solutions with a focus on two areas, which include application acceleration and performance management. The Wide area network (WAN) optimization for application acceleration includes Riverbed SteelHead, which provides WAN optimization solution, and Riverbed SteelFusion, which provides branch converged infrastructure. The Company’s application acceleration solutions also include Riverbed SteelApp, an application delivery controller (ADC). The Company’s performance management solution includes Riverbed SteelCentral, a performance management suite that combines its application-aware network performance management and application performance management control suite.

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