PC Connection (NASDAQ: CNXN) and Synaptics (NASDAQ:SYNA) are both small-cap retail/wholesale companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, profitability and risk.
Volatility & Risk
PC Connection has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500. Comparatively, Synaptics has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500.
Insider & Institutional Ownership
41.4% of PC Connection shares are held by institutional investors. Comparatively, 97.7% of Synaptics shares are held by institutional investors. 57.3% of PC Connection shares are held by insiders. Comparatively, 3.7% of Synaptics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This table compares PC Connection and Synaptics’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares PC Connection and Synaptics’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|PC Connection||$2.69 billion||0.26||$48.11 million||$1.77||14.60|
|Synaptics||$1.72 billion||0.80||$48.80 million||$0.49||82.19|
Synaptics has higher revenue, but lower earnings than PC Connection. PC Connection is trading at a lower price-to-earnings ratio than Synaptics, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings for PC Connection and Synaptics, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PC Connection presently has a consensus target price of $33.00, indicating a potential upside of 27.66%. Synaptics has a consensus target price of $47.53, indicating a potential upside of 18.04%. Given PC Connection’s stronger consensus rating and higher possible upside, research analysts plainly believe PC Connection is more favorable than Synaptics.
PC Connection beats Synaptics on 8 of the 14 factors compared between the two stocks.
PC Connection Company Profile
PC Connection, Inc. is a provider of a range of information technology (IT) solutions. The Company conducts its business operations through three business segments: small- to medium-sized businesses (SMB), Large Account and Public Sector. The Company enables customers to design, enable, manage and service their IT environments. The Company’s IT products include computer systems, software and peripheral equipment, networking communications, and other products and accessories that the Company purchases from manufacturers, distributors and other suppliers. The Company also offers services involving design, configuration and implementation of IT solutions. The Company markets its products and services through its Websites, including www.connection.com, www.connection.com/enterprise, www.connection.com/publicsector, and www.macconnection.com. It uses a combination of outbound telemarketing, including some on-site sales solicitation by business development managers.
Synaptics Company Profile
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.
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