Contrasting SolarWinds (SWI) and Its Competitors

SolarWinds (NYSE: SWI) is one of 103 public companies in the “Enterprise Software” industry, but how does it weigh in compared to its peers? We will compare SolarWinds to related companies based on the strength of its analyst recommendations, profitability, risk, dividends, valuation, earnings and institutional ownership.

Profitability

This table compares SolarWinds and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SolarWinds 20.52% 19.24% 12.70%
SolarWinds Competitors -22.31% -213.12% -7.21%

Institutional and Insider Ownership

61.0% of shares of all “Enterprise Software” companies are held by institutional investors. 22.2% of shares of all “Enterprise Software” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings for SolarWinds and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SolarWinds 0 0 0 0 N/A
SolarWinds Competitors 373 2208 4142 120 2.59

As a group, “Enterprise Software” companies have a potential upside of 2.84%. Given SolarWinds’ peers higher possible upside, analysts clearly believe SolarWinds has less favorable growth aspects than its peers.

Valuation & Earnings

This table compares SolarWinds and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
SolarWinds N/A N/A 50.83
SolarWinds Competitors $1.76 billion $288.64 million 14.92

SolarWinds’ peers have higher revenue and earnings than SolarWinds. SolarWinds is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

SolarWinds has a beta of 1.3, indicating that its share price is 30% more volatile than the S&P 500. Comparatively, SolarWinds’ peers have a beta of 1.07, indicating that their average share price is 7% more volatile than the S&P 500.

SolarWinds Company Profile

SolarWinds, Inc. (SolarWinds) is a holding company. The Company designs, develops, markets, sells and supports enterprise-class information technology (IT), infrastructure management software to IT and DevOps professionals in organizations of all sizes. Its products categories include network management, which is used to monitor and manage the performance of network infrastructure; systems management, which is used to monitor and manage the performance of applications, physical and virtual servers, storage and databases; MSP, which is used by managed service providers to monitor and manage the IT infrastructure of their end clients, SMBs, and cloud, its cloud-based products, which are used to monitor and manage applications and application infrastructure. Its customers include small- and mid-size businesses, enterprises, MSPs, and local, state and federal Government entities.

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