Maxim Integrated Products (NASDAQ:MXIM) and Smart Global (NASDAQ:SGH) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, dividends, analyst recommendations and valuation.
Dividends
Get Maxim Integrated Products alerts:Maxim Integrated Products pays an annual dividend of $1.84 per share and has a dividend yield of 3.3%. Smart Global does not pay a dividend. Maxim Integrated Products pays out 67.9% of its earnings in the form of a dividend. Maxim Integrated Products has increased its dividend for 9 consecutive years.
Profitability
This table compares Maxim Integrated Products and Smart Global’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Maxim Integrated Products | 28.72% | 42.09% | 18.15% |
| Smart Global | 9.13% | 83.61% | 23.28% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for Maxim Integrated Products and Smart Global, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Maxim Integrated Products | 2 | 10 | 4 | 0 | 2.13 |
| Smart Global | 0 | 1 | 4 | 0 | 2.80 |
Maxim Integrated Products currently has a consensus target price of $59.50, suggesting a potential upside of 6.40%. Smart Global has a consensus target price of $50.60, suggesting a potential upside of 70.89%. Given Smart Global’s stronger consensus rating and higher possible upside, analysts clearly believe Smart Global is more favorable than Maxim Integrated Products.
Earnings & Valuation
This table compares Maxim Integrated Products and Smart Global’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Maxim Integrated Products | $2.48 billion | 6.16 | $467.31 million | $2.71 | 20.63 |
| Smart Global | $1.29 billion | 0.52 | $119.46 million | $6.00 | 4.94 |
Maxim Integrated Products has higher revenue and earnings than Smart Global. Smart Global is trading at a lower price-to-earnings ratio than Maxim Integrated Products, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
93.7% of Maxim Integrated Products shares are held by institutional investors. Comparatively, 87.9% of Smart Global shares are held by institutional investors. 0.9% of Maxim Integrated Products shares are held by insiders. Comparatively, 4.2% of Smart Global shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Risk & Volatility
Maxim Integrated Products has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, Smart Global has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500.
Summary
Maxim Integrated Products beats Smart Global on 9 of the 16 factors compared between the two stocks.
About Maxim Integrated Products
Maxim Integrated Products, Inc. designs, develops, manufactures, and markets a range of linear and mixed-signal integrated circuits in the United States, China, the rest of Asia, Europe, and internationally. The company also provides a range of high-frequency process technologies and capabilities for use in custom designs. It serves automotive, communications and data center, computing, consumer, and industrial markets. The company markets its products through a direct-sales and applications organization, as well as through its own and other unaffiliated distribution channels. Maxim Integrated Products, Inc. was founded in 1983 and is headquartered in San Jose, California.
About Smart Global
SMART Global Holdings, Inc. designs, manufactures, and supplies specialty memory solutions worldwide. The company offers dynamic random access memory (DRAM) components, which are used to manufacture modules and other products; DRAM modules for desktop, notebook, and server applications, as well as for use in smartphones; and specialty DRAM modules for industrial, communications, and networking applications, as well as develops specialized memory module designs based on original equipment manufacturer (OEM) requirements. It also provides flash memory, USB, and serial advanced technology attachment products primarily for use in communications equipment, printers, servers and storage products, switches, and routers; and aerospace, automotive, and defense industries, as well as industrial applications. In addition, the company provides networking, storage, and compute solutions, as well as HPC software to manage and use on premise and cloud computing clusters. Further, it offers supply chain services, including procurement, logistics, inventory management, temporary warehousing, programming, kitting, and packaging. SMART Global Holdings, Inc. sells its products to OEMs through direct sales force and independent sales representatives in North America, Latin America, Asia, and Europe. The company was formerly known as Saleen Holdings, Inc. and changed its name to SMART Global Holdings, Inc. in August 2014. SMART Global Holdings, Inc. was founded in 1988 and is headquartered in Newark, California.
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