Reviewing AudioCodes (AUDC) & QUALCOMM (QCOM)

AudioCodes (NASDAQ: AUDC) and QUALCOMM (NASDAQ:QCOM) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, valuation, earnings and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for AudioCodes and QUALCOMM, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AudioCodes 0 1 2 0 2.67
QUALCOMM 1 17 9 0 2.30

AudioCodes presently has a consensus target price of $7.75, indicating a potential upside of 10.40%. QUALCOMM has a consensus target price of $66.50, indicating a potential upside of 3.52%. Given AudioCodes’ stronger consensus rating and higher possible upside, research analysts clearly believe AudioCodes is more favorable than QUALCOMM.

Insider and Institutional Ownership

22.1% of AudioCodes shares are owned by institutional investors. Comparatively, 76.7% of QUALCOMM shares are owned by institutional investors. 48.8% of AudioCodes shares are owned by insiders. Comparatively, 0.2% of QUALCOMM shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

AudioCodes has a beta of 0.3, meaning that its stock price is 70% less volatile than the S&P 500. Comparatively, QUALCOMM has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.

Dividends

QUALCOMM pays an annual dividend of $2.28 per share and has a dividend yield of 3.5%. AudioCodes does not pay a dividend. QUALCOMM pays out 138.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AudioCodes has raised its dividend for 6 consecutive years.

Valuation & Earnings

This table compares AudioCodes and QUALCOMM’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AudioCodes $145.57 million 1.53 $16.23 million $0.54 13.00
QUALCOMM $22.29 billion 4.25 $2.47 billion $1.65 38.93

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

Profitability

This table compares AudioCodes and QUALCOMM’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AudioCodes 11.84% 8.33% 4.75%
QUALCOMM 11.06% 18.08% 9.45%

Summary

QUALCOMM beats AudioCodes on 10 of the 17 factors compared between the two stocks.

AudioCodes Company Profile

AudioCodes Ltd. designs, develops and sells Voice over-Internet Protocol (VoIP) and converged VoIP, and data networking solutions, products and applications that facilitate Unified Communications (UC) and Contact Center (CC) services. The Company categorizes its products and services into two main business lines: network and technology. Network products consist of customer premises equipment (CPE), gateways for the enterprise and service provider (or carrier) markets and of carrier-grade-oriented low- and mid-density media gateways for service providers and Enterprise Session Border Controls (ESBCs). Complementing its media gateways and session border gateways as network products are its multi-service business routers (MSBR), Internet Protocol (IP) phones, media servers, mobile VoIP solutions and value added application products. Technology products consist of its chips and boards business products. Its products are deployed in enterprise, service provider cloud networks.

QUALCOMM Company Profile

QUALCOMM Incorporated is engaged in the development and commercialization of a digital communication technology called code division multiple access (CDMA). The Company is engaged in the development and commercialization of the orthogonal frequency division multiple access (OFDMA) family of technologies, including long-term evolution (LTE), which is an Orthogonal Frequency Division Multiplexing (OFDM)-based standard that uses OFDMA and single-carrier Frequency Division Multiple Access (FDMA), for cellular wireless communication applications. The Company’s segments include QCT (Qualcomm CDMA Technologies), QTL (Qualcomm Technology Licensing) and QSI (Qualcomm Strategic Initiatives). The Company also develops and commercializes a range of other technologies used in handsets and tablets that contribute to end user demand. The Company’s products principally consist of integrated circuits (chips or chipsets) and system software used in mobile devices and in wireless networks.

Receive News & Ratings for AudioCodes Ltd. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for AudioCodes Ltd. and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply