Seagate Technology (NASDAQ:STX) versus TDK (OTCMKTS:TTDKY) Critical Survey

TDK (OTCMKTS:TTDKY) and Seagate Technology (NASDAQ:STX) are both large-cap technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, risk, dividends and earnings.

Volatility & Risk

TDK has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500. Comparatively, Seagate Technology has a beta of 2.06, indicating that its share price is 106% more volatile than the S&P 500.

Profitability

This table compares TDK and Seagate Technology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TDK	7.87%	9.15%	4.48%
Seagate Technology	26.11%	369.98%	37.58%

Earnings & Valuation

This table compares TDK and Seagate Technology”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TDK	$16.64 billion	2.25	$1.29 billion	$0.68	28.34
Seagate Technology	$12.20 billion	17.03	$3.18 billion	$13.88	65.81

Seagate Technology has lower revenue, but higher earnings than TDK. TDK is trading at a lower price-to-earnings ratio than Seagate Technology, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and recommmendations for TDK and Seagate Technology, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TDK	0	1	0	1	3.00
Seagate Technology	0	4	22	1	2.89

Seagate Technology has a consensus target price of $986.00, indicating a potential upside of 7.94%. Given Seagate Technology’s higher possible upside, analysts plainly believe Seagate Technology is more favorable than TDK.

Dividends

TDK pays an annual dividend of $0.15 per share and has a dividend yield of 0.8%. Seagate Technology pays an annual dividend of $2.96 per share and has a dividend yield of 0.3%. TDK pays out 22.1% of its earnings in the form of a dividend. Seagate Technology pays out 21.3% 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. Seagate Technology has raised its dividend for 1 consecutive years.

Insider and Institutional Ownership

92.9% of Seagate Technology shares are owned by institutional investors. 0.0% of TDK shares are owned by insiders. Comparatively, 0.5% of Seagate Technology shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Seagate Technology beats TDK on 14 of the 17 factors compared between the two stocks.

About TDK

TDK Corporation, together with its subsidiaries, engages in manufacture and sale of electronic components in Japan, Europe, China, Asia, the Americas, and internationally. The company operates through Passive Components, Sensor Application Products, Magnetic Application Products, Energy Application Products, and Other segments. The Passive Components segment offers ceramic capacitors, aluminum electrolytic capacitors, film capacitors, high-frequency components, piezoelectric materials, and circuit protection components, as well as inductive devices, including ferrite cores, coils, and transformers. The Sensor Application Products segment provides temperature and pressure, magnetic, and MEMS sensors. The Magnetic Application Products segment offers hard disk drives (HDD) heads, HDD suspension assemblies, and magnets. The Energy Application Products segment provides energy devices comprising rechargeable batteries, and power supplies. The Other segment provides mechatronics production equipment and camera module micro actuators for smartphones and other products. The company also engages in engages in insurance and real estate agency businesses. The company was formerly known as Tokyo Denki Kagaku Kogyo K.K. and changed its name to TDK Corporation in 1983. TDK Corporation was founded in 1935 and is headquartered in Tokyo, Japan.

About Seagate Technology

Seagate Technology Holdings plc provides data storage technology and solutions in Singapore, the United States, the Netherlands, and internationally. It provides mass capacity storage products, including enterprise nearline hard disk drives (HDDs), enterprise nearline solid state drives (SSDs), enterprise nearline systems, video and image HDDs, and network-attached storage drives. The company also offers legacy applications comprising Mission Critical HDDs and SSDs; external storage solutions under the Seagate Ultra Touch, One Touch, and Expansion product lines, as well as under the LaCie brand name; desktop drives; notebook drives, DVR HDDs, and gaming SSDs. In addition, it provides Lyve edge-to-cloud mass capacity platform. The company sells its products primarily to OEMs, distributors, and retailers. Seagate Technology Holdings plc was founded in 1978 and is based in Dublin, Ireland.