Contrasting Capcom (CCOEY) and Cray (CRAY)

Capcom (OTCMKTS: CCOEY) and Cray (NASDAQ:CRAY) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, earnings, risk, valuation and dividends.

Profitability

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This table compares Capcom and Cray’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Capcom N/A N/A N/A
Cray -34.10% -8.51% -6.11%

Risk & Volatility

Capcom has a beta of -5.34, indicating that its stock price is 634% less volatile than the S&P 500. Comparatively, Cray has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Capcom and Cray, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Capcom 0 1 0 0 2.00
Cray 0 0 5 0 3.00

Capcom presently has a consensus target price of $17.84, suggesting a potential upside of 10.95%. Cray has a consensus target price of $27.20, suggesting a potential upside of 36.34%. Given Cray’s stronger consensus rating and higher probable upside, analysts plainly believe Cray is more favorable than Capcom.

Dividends

Capcom pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. Cray does not pay a dividend. Capcom pays out 10.8% of its earnings in the form of a dividend.

Institutional and Insider Ownership

0.0% of Capcom shares are held by institutional investors. Comparatively, 97.3% of Cray shares are held by institutional investors. 4.0% of Cray shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Capcom $806.32 million 5.40 $79.27 million $0.37 43.46
Cray $392.51 million 2.06 -$133.82 million ($1.01) -19.75

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

Summary

Capcom beats Cray on 8 of the 15 factors compared between the two stocks.

Capcom Company Profile

Capcom Co., Ltd. plans, develops, manufactures, sells, and distributes home video games, online games, mobile games, and arcade games in Japan and internationally. It operates through Digital Contents, Arcade Operations, Amusement Equipments, and Other Businesses segments. The Digital Contents segment develops and sells package games and digital download content. This segment also develops and manages mobile contents and PC online games. The Arcade Operations segment operates “Plaza Capcom” amusement facilities in commercial complexes, and hosts various events. The Amusement Equipments segment is involved in the development, manufacture, and sale of frames and LCD devices for gaming machines, as well as software; and development, production, and sale of arcade games for amusement facilities. The Other Businesses segment publishes walkthrough and strategy guides, as well as game settings collections; licenses music CDs and licensed merchandise; and develops game content into movie and TV animation programs. The company was founded in 1979 and is headquartered in Osaka, Japan.

Cray Company Profile

Cray Inc., together with its subsidiaries, designs, develops, manufactures, markets, and services computing systems, and data analytics and artificial intelligence solutions. It operates through Supercomputing, Storage and Data Management, Maintenance and Support, and Engineering Services and Other segments. The company offers a range of Cray XC series supercomputers, including Cray XC40, Cray XC50, and Cray XC50-AC; Cray CS series supercomputers comprises Cray CS500 and Cray CS-Storm; and analytics products, such as Cray Urika-GX platform used for production-class big data analytics workloads. It also provides storage and data management products comprising cray clusterstor storage systems that embeds the Lustre parallel file system and other software in an optimal configuration; and Cray DataWarp applications accelerator, a DataWarp technology that addresses a problem experienced by supercomputing customers. In addition, the company offers custom engineering solutions; and customer support services consisting of hardware and software maintenance, applications support, installation project management, system installation and de-installation, site preparation, and technical training for its systems, as well as ancillary services in application consulting, third-party software support, site engineering, on-site analysts for defined projects, and specialized training. Cray Inc. sells its products through direct sales force and a partner network of global and regional resellers. It serves clients ranging from government agencies or funded research laboratories, academic institutions, and commercial entities in North America, South America, Asia, Europe, the Middle East, Australia, and Africa. The company was formerly known as Tera Computer Company and changed its name to Cray Inc. in 2000. Cray Inc. was founded in 1987 and is headquartered in Seattle, Washington.

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