Broadcom (NASDAQ: BRCM) and Jabil Circuit (NYSE:JBL) are both technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitabiliy, analyst recommendations, institutional ownership, earnings, dividends and risk.

Institutional and Insider Ownership

94.7% of Jabil Circuit shares are owned by institutional investors. 2.9% of Jabil Circuit shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Jabil Circuit pays an annual dividend of $0.32 per share and has a dividend yield of 1.0%. Broadcom does not pay a dividend. Jabil Circuit pays out 50.0% of its earnings in the form of a dividend.

Profitability

This table compares Broadcom and Jabil Circuit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Broadcom 19.62% 17.57% 13.12%
Jabil Circuit 0.66% 12.27% 2.86%

Analyst Recommendations

This is a breakdown of current recommendations for Broadcom and Jabil Circuit, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Broadcom 0 0 1 0 3.00
Jabil Circuit 0 8 3 0 2.27

Broadcom presently has a consensus price target of $216.40, suggesting a potential upside of 295.83%. Jabil Circuit has a consensus price target of $26.60, suggesting a potential downside of 13.47%. Given Broadcom’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Broadcom is more favorable than Jabil Circuit.

Valuation and Earnings

This table compares Broadcom and Jabil Circuit’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Broadcom N/A N/A N/A N/A N/A
Jabil Circuit $18.47 billion 0.30 $1.26 billion $0.64 48.03

Jabil Circuit has higher revenue and earnings than Broadcom.

Summary

Broadcom beats Jabil Circuit on 6 of the 11 factors compared between the two stocks.

Broadcom Company Profile

Broadcom Corporation (Broadcom) provides semiconductor solutions for wired and wireless communications. The Company offers a portfolio of system-on-a-chip solutions (SoCs) that deliver voice, video, data and multimedia connectivity in the home, office and mobile environments. The Company’s solutions are used globally by manufacturers and are embedded in an array of communications products. The Company operates in two segments: Broadband and Connectivity, and Infrastructure and Networking. Broadcom’s solutions in Broadband and Connectivity segment include set-top box solutions, broadband modem solutions, connectivity solutions and a range of other technologies. Its solutions in Infrastructure and Networking segment include Ethernet switches and PHYs, which includes switches and fabrics; copper and optical transceivers; backplane and optical front-end physical layer devices; processors, and other Infrastructure and Networking technologies.

Jabil Circuit Company Profile

Jabil Inc., formerly Jabil Circuit, Inc., provides electronic manufacturing services and solutions throughout the world. The Company operates in two segments, which include Electronics Manufacturing Services (EMS) and Diversified Manufacturing Services (DMS). The Company’s EMS segment is focused on leveraging information technology (IT), supply chain design and engineering, technologies centered on core electronics, sharing of its large scale manufacturing infrastructure and the ability to serve a range of markets. Its DMS segment is focused on providing engineering solutions and a focus on material sciences and technologies. It provides electronic design, production and product management services to companies in the automotive, capital equipment, consumer lifestyles and wearable technologies, computing and storage, defense and aerospace, digital home, emerging growth, healthcare, industrial and energy, mobility, packaging, point of sale and printing industries.

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