Contrasting Sonic Foundry (SOFO) and QUALCOMM (QCOM)

Sonic Foundry (NASDAQ:SOFO) and QUALCOMM (NASDAQ:QCOM) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, analyst recommendations, earnings, dividends and profitability.

Dividends

QUALCOMM pays an annual dividend of $2.48 per share and has a dividend yield of 4.3%. Sonic Foundry does not pay a dividend. QUALCOMM pays out 77.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. QUALCOMM has increased its dividend for 8 consecutive years.

Risk & Volatility

Sonic Foundry has a beta of 0.36, suggesting that its share price is 64% less volatile than the S&P 500. Comparatively, QUALCOMM has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Sonic Foundry -10.87% -258.54% -16.66%
QUALCOMM -21.40% 26.21% 8.42%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Sonic Foundry and QUALCOMM, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sonic Foundry 0 0 0 0 N/A
QUALCOMM 0 9 11 0 2.55

QUALCOMM has a consensus target price of $70.53, indicating a potential upside of 22.66%. Given QUALCOMM’s higher possible upside, analysts plainly believe QUALCOMM is more favorable than Sonic Foundry.

Earnings & Valuation

This table compares Sonic Foundry and QUALCOMM’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sonic Foundry $36.00 million 0.12 -$5.03 million N/A N/A
QUALCOMM $22.73 billion 3.07 -$4.86 billion $3.19 18.03

Sonic Foundry has higher earnings, but lower revenue than QUALCOMM.

Institutional and Insider Ownership

13.1% of Sonic Foundry shares are owned by institutional investors. Comparatively, 89.6% of QUALCOMM shares are owned by institutional investors. 26.4% of Sonic Foundry shares are owned by company insiders. Comparatively, 0.2% of QUALCOMM shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

QUALCOMM beats Sonic Foundry on 10 of the 14 factors compared between the two stocks.

About Sonic Foundry

Sonic Foundry, Inc. provides enterprise solutions and services for the Web communications market in the United States and internationally. It offers Mediasite Video Platform, an on-premises solution to publish, stream, manage, search, and analyze videos; and Mediasite Video Cloud, a solution, which provides hosting and management of content. The company also provides Mediasite Capture Solutions comprising My Mediasite that makes a snap for instructors, employees, and students to create videos, screencasts, and slideshows from their computers or mobile devices; Mediasite RL Recorders that are a series of built-in room appliances for use in recording video and content; Mediasite RL Mini, which builds/expands an automated lecture capture programs in community colleges, vocational-tech schools, small departments, and K12 classrooms; Mediasite Catch, a video capture solution to extend video capture to various classrooms on campus; Mediasite ML Recorders, a video producer with portable recording solutions to capture and stream broadcast-quality video; and Mediasite Join that captures and preserves video calls or meetings. In addition, it provides Mediasite Events, which offers live and on-demand Webcasting for conferences, hybrid events, and high-profile broadcasts; Mediasite Services comprising advanced integration, installation, and training services; and Mediasite Customer care that provides software upgrades and updates, technical support assistance, hardware warranty extension, Mediasite Recorder replacement, and access to the Mediasite Customer care Portal and Mediasite Community. The company markets its products to educational institutions, corporations, and government entities through reseller networks, direct sales, and partnerships with system integrators. Sonic Foundry, Inc. was founded in 1991 and is headquartered in Madison, Wisconsin.

About QUALCOMM

QUALCOMM Incorporated designs, develops, manufactures, and markets digital communication products worldwide. It operates through three segments: Qualcomm CDMA Technologies (QCT); Qualcomm Technology Licensing (QTL); and Qualcomm Strategic Initiatives (QSI). The QCT segment develops and supplies integrated circuits and system software based on code division multiple access (CDMA), orthogonal frequency division multiple access, and other technologies for use in wireless voice and data communications, networking, application processing, multimedia, and global positioning system products. The QTL segment grants licenses or provides rights to use portions of its intellectual property portfolio, which include various patent rights useful in the manufacture and sale of wireless products comprising products implementing CDMA2000, wideband CDMA, CDMA time division duplex, long term evolution, and/or fifth generation standards and their derivatives. The QSI segment invests in early-stage companies in various industries, including automotive, Internet of things, mobile, data center, and healthcare for supporting the design and introduction of new products and services for voice and data communications, and new industry segments. The company also provides products and services for mobile health; products designed for the implementation of small cells; development, and other services and related products to the United States government agencies and their contractors; and software products, and content and push-to-talk enablement services to wireless operators. In addition, it licenses chipset technology, and products and services for use in data centers. QUALCOMM Incorporated was founded in 1985 and is headquartered in San Diego, California.

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