Comparing Western Digital (WDC) & Its Competitors

Western Digital (NASDAQ:WDC) is one of 82 public companies in the “Technology Hardware, Storage & Peripherals” industry, but how does it weigh in compared to its competitors? We will compare Western Digital to similar businesses based on the strength of its earnings, risk, analyst recommendations, dividends, institutional ownership, profitability and valuation.

Profitability

This table compares Western Digital and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Western Digital	72.95%	50.22%	25.30%
Western Digital Competitors	-639.13%	-14.37%	2.86%

Insider & Institutional Ownership

92.5% of Western Digital shares are owned by institutional investors. Comparatively, 51.2% of shares of all “Technology Hardware, Storage & Peripherals” companies are owned by institutional investors. 0.2% of Western Digital shares are owned by insiders. Comparatively, 10.5% of shares of all “Technology Hardware, Storage & Peripherals” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Western Digital has a beta of 2.14, indicating that its stock price is 114% more volatile than the S&P 500. Comparatively, Western Digital’s competitors have a beta of 1.56, indicating that their average stock price is 56% more volatile than the S&P 500.

Dividends

Western Digital pays an annual dividend of $0.60 per share and has a dividend yield of 0.1%. Western Digital pays out 3.6% of its earnings in the form of a dividend. As a group, “Technology Hardware, Storage & Peripherals” companies pay a dividend yield of 3.5% and pay out 42.0% of their earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Western Digital and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Western Digital	0	5	18	2	2.88
Western Digital Competitors	1047	4265	7592	357	2.55

Western Digital presently has a consensus target price of $536.96, suggesting a potential upside of 18.92%. As a group, “Technology Hardware, Storage & Peripherals” companies have a potential upside of 24.72%. Given Western Digital’s competitors higher possible upside, analysts clearly believe Western Digital has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares Western Digital and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Western Digital	$12.92 billion	$1.89 billion	26.96
Western Digital Competitors	$23.51 billion	$3.24 billion	11.93

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

Summary

Western Digital beats its competitors on 10 of the 15 factors compared.

Western Digital Company Profile

Western Digital Corporation develops, manufactures, and sells data storage devices and solutions in the United States, China, Hong Kong, Europe, the Middle East, Africa, rest of Asia, and internationally. It offers client devices, including hard disk drives (HDDs) and solid state drives (SSDs) for desktop and notebook personal computers (PCs), gaming consoles, and set top boxes; and flash-based embedded storage products for mobile phones, tablets, notebook PCs, and other portable and wearable devices, as well as automotive, Internet of Things, industrial, and connected home applications. The company also provides enterprise HDDs; enterprise SSDs consisting of flash-based SSDs and software solutions for use in enterprise servers, online transactions, data analysis, and other enterprise applications; and data storage platforms. In addition, it offers external HDD storage products in mobile and desktop form; client portable SSDs; removable cards that are used in consumer devices comprising mobile phones, tablets, imaging systems, and cameras and smart video systems; universal serial bus flash drives for use in the computing and consumer markets; and wireless drive products used in-field backup of created content, as well as wireless streaming of high-definition movies, photos, music, and documents to tablets, smartphones, and PCs. The company sells its products under the Western Digital, SanDisk, and WD brands to original equipment manufacturers, distributors, dealers, resellers, and retailers. Western Digital Corporation was founded in 1970 and is headquartered in San Jose, California.