Head to Head Comparison: Check Point Software Technologies (NASDAQ:CHKP) and InterDigital (NASDAQ:IDCC)

InterDigital (NASDAQ:IDCC) and Check Point Software Technologies (NASDAQ:CHKP) are both 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.

Profitability

This table compares InterDigital and Check Point Software Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
InterDigital	38.53%	28.34%	15.55%
Check Point Software Technologies	31.74%	34.08%	12.43%

Volatility & Risk

InterDigital has a beta of 1.5, suggesting that its share price is 50% more volatile than the S&P 500. Comparatively, Check Point Software Technologies has a beta of 0.43, suggesting that its share price is 57% less volatile than the S&P 500.

Valuation & Earnings

This table compares InterDigital and Check Point Software Technologies”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
InterDigital	$834.02 million	8.91	$406.64 million	$9.08	31.79
Check Point Software Technologies	$2.73 billion	5.51	$1.06 billion	$8.31	17.71

Check Point Software Technologies has higher revenue and earnings than InterDigital. Check Point Software Technologies is trading at a lower price-to-earnings ratio than InterDigital, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings for InterDigital and Check Point Software Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
InterDigital	0	2	2	0	2.50
Check Point Software Technologies	0	20	10	0	2.33

InterDigital presently has a consensus target price of $425.00, suggesting a potential upside of 47.25%. Check Point Software Technologies has a consensus target price of $151.32, suggesting a potential upside of 2.81%. Given InterDigital’s stronger consensus rating and higher possible upside, equities analysts clearly believe InterDigital is more favorable than Check Point Software Technologies.

Institutional & Insider Ownership

99.8% of InterDigital shares are held by institutional investors. Comparatively, 98.5% of Check Point Software Technologies shares are held by institutional investors. 3.5% of InterDigital shares are held by company insiders. Comparatively, 29.0% of Check Point Software Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

InterDigital beats Check Point Software Technologies on 9 of the 14 factors compared between the two stocks.

About InterDigital

InterDigital, Inc. is a technology research and development company whose work focuses on wireless communications, video and related digital technologies. Rather than selling consumer devices, the company develops technology and licenses its intellectual property to companies that make and use connected products and services. Its research spans cellular communications, including technologies used in 4G and 5G networks, as well as Wi-Fi, video compression and other areas. InterDigital holds patents covering technologies incorporated into industry standards and licenses its portfolio to companies around the world.

About Check Point Software Technologies

Check Point Software Technologies is a cybersecurity company that develops products and services to protect organizations’ networks, cloud environments, devices, and users. Its offerings include network security appliances and software, cloud security tools, endpoint and workspace protection, and centralized security management. The company’s product families include Quantum for network security, CloudGuard for cloud security, and Harmony for user and endpoint protection. Check Point also provides threat prevention, security research, and related support services to businesses and other organizations around the world.