Cavium (NASDAQ: CAVM) is one of 104 publicly-traded companies in the “Semiconductors” industry, but how does it compare to its peers? We will compare Cavium to similar businesses based off the strength of its risk, institutional ownership, profitability, dividends, earnings, analyst recommendations and valuation.

Volatility & Risk

Cavium has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, Cavium’s peers have a beta of 1.07, indicating that their average stock price is 7% more volatile than the S&P 500.

Insider and Institutional Ownership

98.3% of Cavium shares are owned by institutional investors. Comparatively, 68.3% of shares of all “Semiconductors” companies are owned by institutional investors. 4.7% of Cavium shares are owned by insiders. Comparatively, 6.1% of shares of all “Semiconductors” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Cavium and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cavium -22.82% 5.94% 2.78%
Cavium Competitors -47.63% 0.26% 0.13%

Valuation and Earnings

This table compares Cavium and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Cavium $865.94 million $79.41 million -21.06
Cavium Competitors $4.51 billion $1.30 billion 83.01

Cavium’s peers have higher revenue and earnings than Cavium. Cavium is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently the more affordable than other companies in its industry.

Analyst Ratings

This is a summary of current ratings and recommmendations for Cavium and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cavium 0 5 13 0 2.72
Cavium Competitors 1143 5228 8750 407 2.54

Cavium currently has a consensus price target of $77.29, suggesting a potential upside of 23.97%. All “Semiconductors” companies have a potential upside of 15.17%. Given Cavium’s stronger consensus rating and higher probable upside, analysts clearly believe Cavium is more favorable than its peers.

Summary

Cavium beats its peers on 9 of the 13 factors compared.

Cavium Company Profile

Cavium, Inc. is a provider of integrated semiconductor processors that enable intelligent processing for wired and wireless infrastructure and cloud for networking, communications, storage and security applications. The Company’s products consist of multi-core processors for embedded and data center applications, network connectivity for server and switches, storage connectivity, and security processors for offload and appliance. A range of its products also include a suite of embedded security protocols that enable unified threat management (UTM), secure connectivity, network perimeter protection and deep packet inspection (DPI). The Company sells its products to networking original equipment manufacturers (OEM), which sell into the enterprise, datacenter, service provider, and broadband and consumer markets. In the enterprise market, its products are used in routers, switches, storage appliances, server connectivity for networking and storage, wireless local area networks and UTM.

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