Comparing Cisco Systems (NASDAQ:CSCO) and Belden (NYSE:BDC)

Belden (NYSE:BDC) and Cisco Systems (NASDAQ:CSCO) are both technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, dividends, earnings, risk and profitability.

Profitability

This table compares Belden and Cisco Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Belden	8.52%	25.00%	9.24%
Cisco Systems	20.14%	28.44%	10.99%

Insider & Institutional Ownership

98.8% of Belden shares are owned by institutional investors. Comparatively, 73.3% of Cisco Systems shares are owned by institutional investors. 1.1% of Belden shares are owned by company insiders. Comparatively, 0.0% of Cisco Systems shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Belden and Cisco Systems, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Belden	0	1	4	2	3.14
Cisco Systems	0	7	15	2	2.79

Belden currently has a consensus target price of $156.25, suggesting a potential upside of 17.48%. Cisco Systems has a consensus target price of $123.14, suggesting a potential upside of 1.41%. Given Belden’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Belden is more favorable than Cisco Systems.

Dividends

Belden pays an annual dividend of $0.20 per share and has a dividend yield of 0.2%. Cisco Systems pays an annual dividend of $1.68 per share and has a dividend yield of 1.4%. Belden pays out 3.3% of its earnings in the form of a dividend. Cisco Systems pays out 54.5% 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. Cisco Systems has increased its dividend for 13 consecutive years. Cisco Systems is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Belden and Cisco Systems”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Belden	$2.72 billion	1.91	$237.52 million	$6.15	21.63
Cisco Systems	$56.65 billion	8.45	$10.18 billion	$3.08	39.43

Cisco Systems has higher revenue and earnings than Belden. Belden is trading at a lower price-to-earnings ratio than Cisco Systems, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Belden has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, Cisco Systems has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500.

Summary

Cisco Systems beats Belden on 10 of the 17 factors compared between the two stocks.

About Belden

Belden Inc. designs, manufactures, and markets a portfolio of signal transmission solutions for mission critical applications in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. It operates in two segments, Enterprise Solutions and Industrial Automation Solutions. The Enterprise Solutions segment offers copper cable and connectivity solutions, fiber cable and connectivity solutions, interconnect panels, racks and enclosures, and signal extension and matrix switching systems for use in applications, such as local area networks, data centers, access control, 5G, fiber to the home, and building automation. It also provides power, cooling, and airflow management products for mission-critical data center operations; and end-to-end fiber and copper network systems. This segment serves commercial real estate, education, financial, stadiums and venues, military installations, and broadband and wireless service providers, as well as data centers, governments, healthcare, and hospitality sectors. The Industrial Automation Solutions segment offers network infrastructure and digitization solutions; secure networks for the digitization and automation of industries and infrastructure; and products and solutions covering various aspects of data handling, including acquisition, transmission, orchestration, and management for applications in discrete automation, process automation, energy, and mass transit. It sells its products to distributors, end-users, installers, and original equipment manufacturers (OEMs). The company was formerly known as Belden CDT Inc. and changed its name to Belden Inc. in May 2007. Belden Inc. was founded in 1902 and is headquartered in Saint Louis, Missouri.

About Cisco Systems

Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.