Financial Analysis: Silicom (SILC) vs. Its Rivals

Silicom (NASDAQ:SILC) is one of 110 public companies in the “Communications Equipment” industry, but how does it compare to its peers? We will compare Silicom to related companies based on the strength of its dividends, risk, profitability, institutional ownership, valuation, earnings and analyst recommendations.

Insider and Institutional Ownership

52.8% of Silicom shares are owned by institutional investors. Comparatively, 44.4% of shares of all “Communications Equipment” companies are owned by institutional investors. 25.4% of Silicom shares are owned by company insiders. Comparatively, 18.4% of shares of all “Communications Equipment” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Silicom	-8.47%	-6.31%	-4.65%
Silicom Competitors	5.57%	-5.33%	3.13%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Silicom and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Silicom	1	0	1	0	2.00
Silicom Competitors	1077	4036	7105	383	2.54

Silicom currently has a consensus target price of $60.00, suggesting a potential upside of 80.91%. As a group, “Communications Equipment” companies have a potential upside of 38.60%. Given Silicom’s higher probable upside, equities research analysts plainly believe Silicom is more favorable than its peers.

Volatility and Risk

Silicom has a beta of 1.68, indicating that its stock price is 68% more volatile than the S&P 500. Comparatively, Silicom’s peers have a beta of 1.17, indicating that their average stock price is 17% more volatile than the S&P 500.

Valuation & Earnings

This table compares Silicom and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Silicom	$61.93 million	-$11.48 million	-25.91
Silicom Competitors	$2.74 billion	$292.54 million	4.72

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

Summary

Silicom peers beat Silicom on 9 of the 13 factors compared.

About Silicom

Silicom Ltd. is an Israel-based technology company that designs and manufactures high-performance networking and data infrastructure solutions. Its products are used to improve network connectivity, traffic management, security, and processing in servers, appliances, and communications systems. The company’s product portfolio includes server and network interface adapters, bypass solutions, network appliances, packet-processing platforms, and other specialized connectivity products. Silicom also develops solutions for cloud computing, edge computing, cybersecurity, telecommunications, and service-provider applications, often working with original equipment manufacturers and system integrators.