Comparing Alps Electric (OTCMKTS:APELY) and PC Connection (NASDAQ:CNXN)

PC Connection (NASDAQ:CNXN) and Alps Electric (OTCMKTS:APELY) are both mid-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, analyst recommendations, profitability, dividends, institutional ownership and risk.

Volatility and Risk

PC Connection has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500. Comparatively, Alps Electric has a beta of 0.43, meaning that its stock price is 57% less volatile than the S&P 500.

Institutional and Insider Ownership

42.8% of PC Connection shares are owned by institutional investors. Comparatively, 0.1% of Alps Electric shares are owned by institutional investors. 56.6% of PC Connection shares are owned by insiders. Comparatively, 10.4% of Alps Electric shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

PC Connection pays an annual dividend of $0.80 per share and has a dividend yield of 0.9%. Alps Electric pays an annual dividend of $0.46 per share and has a dividend yield of 1.6%. PC Connection pays out 19.8% of its earnings in the form of a dividend. Alps Electric pays out 42.2% 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. PC Connection has raised its dividend for 2 consecutive years.

Valuation & Earnings

This table compares PC Connection and Alps Electric”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PC Connection	$2.87 billion	0.76	$83.72 million	$4.05	21.44
Alps Electric	$6.77 billion	0.43	$177.41 million	$1.09	25.86

Alps Electric has higher revenue and earnings than PC Connection. PC Connection is trading at a lower price-to-earnings ratio than Alps Electric, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings for PC Connection and Alps Electric, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PC Connection	0	1	1	0	2.50
Alps Electric	0	0	0	1	4.00

Profitability

This table compares PC Connection and Alps Electric’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PC Connection	3.25%	11.38%	7.49%
Alps Electric	2.64%	7.24%	4.09%

Summary

PC Connection beats Alps Electric on 11 of the 17 factors compared between the two stocks.

About PC Connection

PC Connection, Inc., together with its subsidiaries, provides a range of information technology (IT) solutions. The company operates through three segments: Business Solutions, Enterprise Solutions, and Public Sector Solutions. It offers IT products, such as computer systems, software and peripheral equipment, networking communications, and other products and accessories. The company also provides services comprising design, configuration, and implementation of IT solutions. In addition, publishes Connected, a quarterly publication that provides informative articles on the latest technologies and industry trends; distributes specialty catalogs to education, healthcare, and government customers; and MacConnection that publishes a catalog for the Apple market. The company markets its products and services through its Websites, such as connection.com, connection.com/enterprise, connection.com/publicsector, and macconnection.com. It serves small to medium-sized businesses (SMBs) comprising small office/home offices customers; government and educational institutions; and medium-to-large corporate accounts through outbound telemarketing and field sales and marketing programs targeted to specific customer populations, as well as through digital, Web, and print media advertising. PC Connection, Inc. was founded in 1982 and is headquartered in Merrimack, New Hampshire.

About Alps Electric

Alps Alpine Co., Ltd. manufactures and sells electronic components in Japan and internationally. It operates through four segments: Components, Sensor Communication, Module Systems, and Logistics. The company’s products for the consumer, industrial equipment, and IoT markets include TACT switches, worker condition monitoring systems, HAPTIC reactor, actuator for cameras, remote monitoring system for logistics, analog meter monitoring system, resistive position sensor, pressure sensor, air environment sensor module, three-axis geomagnetic sensor, humidity sensor, and pc board mount current sensor. Its products for the automotive market comprises TACT and detector switches, Encoder, aspherical glass lens with metal holder, HAPTIC reactor, trimagic converter, current sensor, magnetic sensor, millimeter-wave sensor, GNSS module, 5G NR module, power window switch, electric shifter, sound system, cabin controller, smart door trim, electric shifter, integrated display, premium sound speakers, and customized car products. The company also provides systems development, office, and financing and leasing services, as well as transportation, storage, and forwarding services. The company was formerly known as Alps Electric Co., Ltd. and changed its name to Alps Alpine Co., Ltd. in January 2019. The company was incorporated in 1948 and is headquartered in Tokyo, Japan.