Head-To-Head Analysis: Intel Corporation (INTC) vs. Cavium (CAVM)

Cavium (NASDAQ: CAVM) and Intel Corporation (NASDAQ:INTC) are both mid-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, valuation, analyst recommendations, dividends, earnings and risk.

Dividends

Intel Corporation pays an annual dividend of $1.09 per share and has a dividend yield of 2.4%. Cavium does not pay a dividend. Intel Corporation pays out 38.1% of its earnings in the form of a dividend. Cavium has increased its dividend for 2 consecutive years.

Risk & Volatility

Cavium has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500. Comparatively, Intel Corporation has a beta of 1.09, indicating that its stock price is 9% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Cavium and Intel Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cavium 0 4 13 0 2.76
Intel Corporation 4 12 25 0 2.51

Cavium currently has a consensus price target of $78.00, indicating a potential upside of 0.84%. Intel Corporation has a consensus price target of $42.91, indicating a potential downside of 5.87%. Given Cavium’s stronger consensus rating and higher probable upside, equities analysts clearly believe Cavium is more favorable than Intel Corporation.

Earnings & Valuation

This table compares Cavium and Intel Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Cavium $603.31 million 8.86 -$147.20 million ($2.82) -27.43
Intel Corporation $59.39 billion 3.59 $10.32 billion $2.86 15.94

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

Profitability

This table compares Cavium and Intel Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cavium -19.94% 11.16% 5.23%
Intel Corporation 22.31% 22.65% 12.91%

Insider & Institutional Ownership

99.1% of Cavium shares are held by institutional investors. Comparatively, 67.4% of Intel Corporation shares are held by institutional investors. 4.7% of Cavium shares are held by company insiders. Comparatively, 0.1% of Intel Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Cavium beats Intel Corporation on 9 of the 17 factors compared between the two stocks.

About Cavium

Cavium, Inc. is a provider of integrated semiconductor processors that enable intelligent processing for wired and wireless infrastructure and cloud for networking, communications, storage and security applications. The Company’s products consist of multi-core processors for embedded and data center applications, network connectivity for server and switches, storage connectivity, and security processors for offload and appliance. A range of its products also include a suite of embedded security protocols that enable unified threat management (UTM), secure connectivity, network perimeter protection and deep packet inspection (DPI). The Company sells its products to networking original equipment manufacturers (OEM), which sell into the enterprise, datacenter, service provider, and broadband and consumer markets. In the enterprise market, its products are used in routers, switches, storage appliances, server connectivity for networking and storage, wireless local area networks and UTM.

About Intel Corporation

Intel Corporation is engaged in designing and manufacturing products and technologies, such as the cloud. The Company’s segments are Client Computing Group (CCG), Data Center Group (DCG), Internet of Things Group (IOTG), Non-Volatile Memory Solutions Group (NSG), Intel Security Group (ISecG), Programmable Solutions Group (PSG), All Other and New Technology Group (NTG). It delivers computer, networking and communications platforms to a set of customers, including original equipment manufacturers (OEMs), original design manufacturers (ODMs), cloud and communications service providers, as well as industrial, communications and automotive equipment manufacturers. It offers platforms to integrate various components and technologies, including a microprocessor and chipset, a stand-alone System-on-Chip (SoC), or a multichip package. The CCG operating segment includes platforms that integrates in notebook, two in one systems, desktop computers for consumers and businesses, tablets, and phones.

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