QLogic (QLGC) & PC Connection (CNXN) Critical Analysis
QLogic (NASDAQ: QLGC) and PC Connection (NASDAQ:CNXN) are both technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.
Risk and Volatility
QLogic has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500. Comparatively, PC Connection has a beta of 1.68, suggesting that its stock price is 68% more volatile than the S&P 500.
Earnings and Valuation
This table compares QLogic and PC Connection’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PC Connection||$2.86 billion||0.26||$90.07 million||$1.79||15.74|
PC Connection has higher revenue and earnings than QLogic. PC Connection is trading at a lower price-to-earnings ratio than QLogic, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
41.4% of PC Connection shares are held by institutional investors. 57.3% of PC Connection shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for QLogic and PC Connection, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PC Connection has a consensus target price of $33.00, suggesting a potential upside of 17.10%. Given PC Connection’s higher probable upside, analysts plainly believe PC Connection is more favorable than QLogic.
This table compares QLogic and PC Connection’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
PC Connection beats QLogic on 8 of the 10 factors compared between the two stocks.
QLogic Corporation (QLogic), designs and supplies server and storage networking connectivity products that provide and manage computer data communication. The Company’s products facilitate the transfer of data and enable resource sharing between servers, networks and storage. Its products are used in enterprise, managed service provider, consumer Web, and cloud service provider data centers. Its products are based primarily on Fiber Channel and Ethernet technologies and are used in connection with storage networks, data networks and converged networks. Storage networks are used to provide access to storage across enterprise environments. Fibre Channel is a technology for enterprise storage networking. Data networks are used to provide workstation-to-server, server-to-server, and server-to-storage connectivity using Ethernet. Converged networks are designed to address the data center by consolidating and unifying storage and data networks, using high-speed Ethernet.
About PC Connection
PC Connection, Inc. is a provider of a range of information technology (IT) solutions. The Company conducts its business operations through three business segments: small- to medium-sized businesses (SMB), Large Account and Public Sector. The Company enables customers to design, enable, manage and service their IT environments. The Company’s IT products include computer systems, software and peripheral equipment, networking communications, and other products and accessories that the Company purchases from manufacturers, distributors and other suppliers. The Company also offers services involving design, configuration and implementation of IT solutions. The Company markets its products and services through its Websites, including www.connection.com, www.connection.com/enterprise, www.connection.com/publicsector, and www.macconnection.com. It uses a combination of outbound telemarketing, including some on-site sales solicitation by business development managers.
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