Quantum (NYSE: QTM) and PC Connection (NASDAQ:CNXN) are both small-cap technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, earnings, valuation, profitability and analyst recommendations.
Earnings and Valuation
This table compares Quantum and PC Connection’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Quantum||$505.35 million||0.28||$3.64 million||($0.25)||-16.16|
|PC Connection||$2.91 billion||0.22||$54.86 million||$2.05||11.91|
PC Connection has higher revenue and earnings than Quantum. Quantum is trading at a lower price-to-earnings ratio than PC Connection, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations and price targets for Quantum and PC Connection, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Quantum currently has a consensus target price of $10.00, indicating a potential upside of 147.52%. PC Connection has a consensus target price of $33.00, indicating a potential upside of 35.19%. Given Quantum’s higher probable upside, equities research analysts clearly believe Quantum is more favorable than PC Connection.
This table compares Quantum and PC Connection’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider & Institutional Ownership
64.2% of Quantum shares are owned by institutional investors. Comparatively, 39.9% of PC Connection shares are owned by institutional investors. 8.6% of Quantum shares are owned by company insiders. Comparatively, 57.3% of PC Connection shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Volatility and Risk
Quantum has a beta of 2.16, suggesting that its stock price is 116% more volatile than the S&P 500. Comparatively, PC Connection has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500.
PC Connection beats Quantum on 8 of the 12 factors compared between the two stocks.
Quantum Corporation focuses on scale-out storage, archive and data protection, providing solutions for capturing, sharing, managing and preserving digital assets over the entire data lifecycle. The Company’s end-to-end tiered storage solutions enable users to maximize the value of their data by making it accessible whenever and wherever needed, retaining it indefinitely and reducing total cost and complexity. It works with a network of distributors, value-added resellers (VARs), direct marketing resellers (DMRs), original equipment manufacturers (OEMs) and other suppliers to meet customers’ evolving needs. Its scale-out storage portfolio includes StorNext software, appliances and full systems called StorNext Pro Solutions, as well as Xcellis workflow storage, QXS disk storage, Lattus extended online storage and Q-Cloud Archive and Vault services. Its StorNext offerings enable customers to manage large unstructured data sets in an information workflow.
About PC Connection
PC Connection, Inc. is a provider of a range of information technology (IT) solutions. The Company conducts its business operations through three business segments: small- to medium-sized businesses (SMB), Large Account and Public Sector. The Company enables customers to design, enable, manage and service their IT environments. The Company’s IT products include computer systems, software and peripheral equipment, networking communications, and other products and accessories that the Company purchases from manufacturers, distributors and other suppliers. The Company also offers services involving design, configuration and implementation of IT solutions. The Company markets its products and services through its Websites, including www.connection.com, www.connection.com/enterprise, www.connection.com/publicsector, and www.macconnection.com. It uses a combination of outbound telemarketing, including some on-site sales solicitation by business development managers.
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