FunctionX (NASDAQ: FNCX) and Dolby Laboratories (NYSE:DLB) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

1.6% of FunctionX shares are held by institutional investors. Comparatively, 51.9% of Dolby Laboratories shares are held by institutional investors. 66.9% of FunctionX shares are held by insiders. Comparatively, 43.8% of Dolby Laboratories shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Dolby Laboratories pays an annual dividend of $0.56 per share and has a dividend yield of 1.0%. FunctionX does not pay a dividend. Dolby Laboratories pays out 28.6% of its earnings in the form of a dividend. Dolby Laboratories has raised its dividend for 2 consecutive years.

Volatility & Risk

FunctionX has a beta of -0.62, indicating that its stock price is 162% less volatile than the S&P 500. Comparatively, Dolby Laboratories has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500.

Profitability

This table compares FunctionX and Dolby Laboratories’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FunctionX -228.07% N/A -34.26%
Dolby Laboratories 19.02% 10.25% 8.78%

Earnings and Valuation

This table compares FunctionX and Dolby Laboratories’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
FunctionX $3.13 million 0.05 -$10.43 million N/A N/A
Dolby Laboratories $1.07 billion 5.52 $340.22 million $1.96 29.35

Dolby Laboratories has higher revenue and earnings than FunctionX.

Analyst Recommendations

This is a summary of recent recommendations for FunctionX and Dolby Laboratories, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FunctionX 0 0 0 0 N/A
Dolby Laboratories 0 2 3 0 2.60

Dolby Laboratories has a consensus price target of $56.88, suggesting a potential downside of 1.12%. Given Dolby Laboratories’ higher probable upside, analysts plainly believe Dolby Laboratories is more favorable than FunctionX.

Summary

Dolby Laboratories beats FunctionX on 12 of the 14 factors compared between the two stocks.

About FunctionX

Function(x) Inc., formerly DraftDay Fantasy Sports, Inc., is a diversified media and entertainment company. The Company conducts three lines of businesses, which are digital publishing through Wetpaint.com, Inc. (Wetpaint) and Rant, Inc. (Rant); fantasy sports gaming through DraftDay Gaming Group, Inc. (DDGG), and digital content distribution through Choose Digital, Inc. (Choose Digital). The Company’s segments include Wetpaint, which is a media channel reporting original news stories and publishing information content covering television shows, music, celebrities, entertainment news and fashion; Choose Digital, which is a business-to-business platform for delivering digital content; DDGG, which is a business-to-business operator of daily fantasy sports, and Other. The Company’s digital publishing business also includes Rant, which is a digital publisher that publishes original content in over 13 verticals, such as in sports, entertainment, pets, cars and food.

About Dolby Laboratories

Dolby Laboratories, Inc. designs and manufactures audio and imaging products for the cinema, television, broadcast and entertainment industries. Its products for cinema include Digital Cinema Servers and Cinema Audio Products, and broadcast and other include Dolby Conference Phone and Other Products. It offers services to support theatrical and television production for cinema exhibition, broadcast and home entertainment, including equipment training and maintenance, mixing room alignment and equalization, as well as audio, color and light image calibration. Its technologies include Advanced Audio Coding and High Efficiency Advanced Audio Coding, Dolby AC-4, Dolby Atmos, Dolby Digital, Dolby Digital Plus, Dolby TrueHD, Dolby Vision, Dolby Voice and High Efficiency Video Coding. It distributes its products in over 80 countries. Its technologies are incorporated in offerings in various end markets, such as the broadcast, Personal Computer, mobile, consumer electronics and other markets.

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