Silicom (NYSE: IBM) and IBM Common Stock (NYSE:IBM) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, dividends, risk, institutional ownership and earnings.
This table compares Silicom and IBM Common Stock’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|IBM Common Stock||7.13%||69.84%||10.52%|
This is a breakdown of current recommendations and price targets for Silicom and IBM Common Stock, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|IBM Common Stock||3||11||8||0||2.23|
Silicom currently has a consensus target price of $50.00, indicating a potential upside of 29.57%. IBM Common Stock has a consensus target price of $166.19, indicating a potential upside of 13.29%. Given Silicom’s stronger consensus rating and higher possible upside, research analysts plainly believe Silicom is more favorable than IBM Common Stock.
IBM Common Stock pays an annual dividend of $6.28 per share and has a dividend yield of 4.3%. Silicom does not pay a dividend. IBM Common Stock pays out 45.5% of its earnings in the form of a dividend. IBM Common Stock has increased its dividend for 18 consecutive years.
Volatility & Risk
Silicom has a beta of 1.37, meaning that its stock price is 37% more volatile than the S&P 500. Comparatively, IBM Common Stock has a beta of 0.9, meaning that its stock price is 10% less volatile than the S&P 500.
Valuation and Earnings
This table compares Silicom and IBM Common Stock’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Silicom||$125.69 million||2.32||$21.71 million||N/A||N/A|
|IBM Common Stock||$79.14 billion||1.69||$5.75 billion||$13.80||10.63|
IBM Common Stock has higher revenue and earnings than Silicom.
Insider & Institutional Ownership
31.9% of Silicom shares are owned by institutional investors. Comparatively, 55.6% of IBM Common Stock shares are owned by institutional investors. 25.4% of Silicom shares are owned by company insiders. Comparatively, 0.2% of IBM Common Stock shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Silicom Company Profile
Silicom Ltd., together with its subsidiaries, designs, manufactures, markets, and supports networking and data infrastructure solutions for a range of servers, server based systems, and communications devices in North America, Europe, and the Asia Pacific. It offers server network interface cards with and without bypass for the server networking industry. The company also provides intelligent and programmable cards, including redirector and switching cards; encryption and data compression hardware acceleration cards; full field programmable gate array (FPGA) based packet processing cards; and compute blades. In addition, it offers customer premise equipment (CPE), vCPE or edge networking devices products for SD-WAN and NFV deployments; networking targeted appliances; and bypass switches and intelligent bypass switches. The company sells its products primarily to original equipment manufacturers, and cloud and telco companies. Silicom Ltd. was founded in 1987 and is headquartered in Kfar Sava, Israel.
IBM Common Stock Company Profile
International Business Machines Corporation operates as an integrated technology and services company worldwide. Its Cognitive Solutions segment offers Watson, a cognitive computing platform that interacts in natural language, processes big data, and learns from interactions with people and computers. This segment also offers data and analytics solutions, including analytics and data management platforms, cloud data services, enterprise social software, talent management solutions, and solutions tailored by industry; and transaction processing software that runs mission-critical systems in banking, airlines, and retail industries. The company's Global Business Services segment offers business consulting services; delivers system integration, application management, maintenance, and support services for packaged software applications; and finance, procurement, talent and engagement, and industry-specific business process outsourcing services. Its Technology Services & Cloud Platforms segment provides cloud, project-based, outsourcing, and other managed services for enterprise IT infrastructure environments. This segment also offers technical support, and software and solution support; and integration software solutions. The company's Systems segment offers servers for businesses, cloud service providers, and scientific computing organizations; data storage products and solutions; and z/OS, an enterprise operating system. Its Global Financing segment provides lease, installment payment plans, and loan financing services; short-term working capital financing to suppliers, distributors, and resellers; and remanufacturing and remarketing services. The company was formerly known as Computing-Tabulating-Recording Co. and changed its name to International Business Machines Corporation in 1924. International Business Machines Corporation was founded in 1911 and is headquartered in Armonk, New York.
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