HP (NYSE: HPQ) and Knowles Corporation (NYSE:KN) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.
Volatility & Risk
HP has a beta of 1.93, suggesting that its stock price is 93% more volatile than the S&P 500. Comparatively, Knowles Corporation has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500.
This table compares HP and Knowles Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
79.2% of HP shares are owned by institutional investors. 0.6% of HP shares are owned by company insiders. Comparatively, 2.2% of Knowles Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This is a summary of recent ratings for HP and Knowles Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
HP currently has a consensus target price of $20.58, suggesting a potential upside of 6.50%. Knowles Corporation has a consensus target price of $18.50, suggesting a potential upside of 23.91%. Given Knowles Corporation’s stronger consensus rating and higher probable upside, analysts clearly believe Knowles Corporation is more favorable than HP.
Earnings & Valuation
This table compares HP and Knowles Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|HP||$50.64 billion||0.64||$4.20 billion||$1.38||14.00|
|Knowles Corporation||$867.60 million||1.54||$141.10 million||($0.23)||-64.91|
HP has higher revenue and earnings than Knowles Corporation. Knowles Corporation is trading at a lower price-to-earnings ratio than HP, indicating that it is currently the more affordable of the two stocks.
HP pays an annual dividend of $0.53 per share and has a dividend yield of 2.7%. Knowles Corporation does not pay a dividend. HP pays out 38.4% of its earnings in the form of a dividend.
HP beats Knowles Corporation on 9 of the 16 factors compared between the two stocks.
HP Inc. is a provider of products, technologies, software, solutions and services to individual consumers, small- and medium-sized businesses, and enterprises, including customers in the government, health and education sectors. The Company provides personal computing and other access devices, imaging and printing products, and related technologies, solutions and services. Its segments include Personal Systems, Printing and Corporate Investments. The Personal Systems segment provides Commercial personal computers (PCs), Consumer PCs, workstations, thin clients, Commercial tablets and mobility devices, retail point-of-sale systems, displays and other accessories, software, support and services for the commercial and consumer markets. The Printing segment provides consumer and commercial printer hardware, supplies, media, solutions and services, as well as scanning devices. The Corporate Investments segment includes the operations of HP Labs and certain business incubation projects.
About Knowles Corporation
Knowles Corporation is a global supplier of micro-acoustic, audio processing and specialty component solutions, serving the mobile consumer electronics, communications, medical, military, aerospace and industrial markets. The Company operates through two segments: Mobile Consumer Electronics (MCE) and Specialty Components (SC). MCE designs and manufactures acoustic products, including microphones and audio processing technologies used in mobile handsets, wearables and other consumer electronic devices. SC specializes in the design and manufacture of specialized electronic components used in medical and life science applications, as well as solutions and components used in communications infrastructure and a range of other markets. It has sales, support and engineering facilities in North America, Europe and Asia, and manufacturing facilities in Asia. It also offers acoustics components used in hearing aids, as well as high-end oscillators (timing devices) and capacitors.
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