SMC (OTCMKTS:SMCAY) and TD SYNNEX (NYSE:SNX) Head to Head Review

SMC (OTCMKTS:SMCAY) and TD SYNNEX (NYSE:SNX) are both large-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, earnings, valuation and risk.

Earnings and Valuation

This table compares SMC and TD SYNNEX”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SMC	$5.60 billion	4.26	$1.10 billion	$1.03	18.12
TD SYNNEX	$75.67 billion	0.25	$827.66 million	$16.41	14.18

SMC has higher earnings, but lower revenue than TD SYNNEX. TD SYNNEX is trading at a lower price-to-earnings ratio than SMC, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares SMC and TD SYNNEX’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SMC	21.94%	9.40%	8.53%
TD SYNNEX	1.75%	16.78%	3.98%

Insider and Institutional Ownership

1.0% of SMC shares are owned by institutional investors. Comparatively, 84.0% of TD SYNNEX shares are owned by institutional investors. 0.7% of TD SYNNEX shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

SMC has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500. Comparatively, TD SYNNEX has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for SMC and TD SYNNEX, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SMC	0	2	1	0	2.33
TD SYNNEX	0	1	7	1	3.00

TD SYNNEX has a consensus target price of $331.14, suggesting a potential upside of 42.36%. Given TD SYNNEX’s stronger consensus rating and higher possible upside, analysts clearly believe TD SYNNEX is more favorable than SMC.

Dividends

SMC pays an annual dividend of $0.18 per share and has a dividend yield of 1.0%. TD SYNNEX pays an annual dividend of $1.92 per share and has a dividend yield of 0.8%. SMC pays out 17.5% of its earnings in the form of a dividend. TD SYNNEX pays out 11.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. TD SYNNEX has increased its dividend for 5 consecutive years.

Summary

TD SYNNEX beats SMC on 12 of the 18 factors compared between the two stocks.

About SMC

SMC Corporation is a Japan-based manufacturer of components and systems used in factory automation. Its products include pneumatic control equipment, valves, actuators, air-preparation units, vacuum equipment and temperature-control devices. The company’s products help control the movement of air, fluids and machinery in automated production processes. SMC serves manufacturers across a range of industries, including automotive, electronics and food processing. Founded in Japan in 1959, SMC has grown into an international supplier, serving customers through operations and sales networks in markets around the world.

About TD SYNNEX

TD SYNNEX is a global distributor and solutions aggregator serving the information technology industry. The company connects technology vendors with channel partners, including resellers, systems integrators, managed service providers and retailers. Its offerings span hardware, software and services across areas such as cloud computing, cybersecurity, data center infrastructure, networking and end-user computing. TD SYNNEX also provides partners with services that can support technology deployment, integration and ongoing management.