Analyzing Seagate Technology (NASDAQ:STX) and Lenovo Group (OTCMKTS:LNVGY)

Seagate Technology (NASDAQ:STX) and Lenovo Group (OTCMKTS:LNVGY) are both large-cap technology companies, but which is the better business? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, dividends and profitability.

Dividends

Seagate Technology pays an annual dividend of $2.96 per share and has a dividend yield of 0.4%. Lenovo Group pays an annual dividend of $1.68 per share and has a dividend yield of 2.3%. Seagate Technology pays out 21.3% of its earnings in the form of a dividend. Lenovo Group pays out 60.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Seagate Technology has increased its dividend for 1 consecutive years.

Profitability

This table compares Seagate Technology and Lenovo Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Seagate Technology	26.11%	369.98%	37.58%
Lenovo Group	2.30%	27.74%	4.21%

Institutional & Insider Ownership

92.9% of Seagate Technology shares are owned by institutional investors. Comparatively, 0.1% of Lenovo Group shares are owned by institutional investors. 0.8% of Seagate Technology shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Seagate Technology has a beta of 2.06, indicating that its share price is 106% more volatile than the S&P 500. Comparatively, Lenovo Group has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500.

Earnings and Valuation

This table compares Seagate Technology and Lenovo Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Seagate Technology	$12.20 billion	15.25	$3.18 billion	$13.88	59.12
Lenovo Group	$83.08 billion	0.54	$1.91 billion	$2.77	26.16

Seagate Technology has higher earnings, but lower revenue than Lenovo Group. Lenovo Group is trading at a lower price-to-earnings ratio than Seagate Technology, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Seagate Technology and Lenovo Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seagate Technology	0	4	22	1	2.89
Lenovo Group	0	1	0	1	3.00

Seagate Technology presently has a consensus price target of $986.00, suggesting a potential upside of 20.17%. Given Seagate Technology’s higher probable upside, analysts plainly believe Seagate Technology is more favorable than Lenovo Group.

Summary

Seagate Technology beats Lenovo Group on 14 of the 17 factors compared between the two stocks.

About Seagate Technology

Seagate Technology Holdings plc provides data storage technology and solutions in Singapore, the United States, the Netherlands, and internationally. It provides mass capacity storage products, including enterprise nearline hard disk drives (HDDs), enterprise nearline solid state drives (SSDs), enterprise nearline systems, video and image HDDs, and network-attached storage drives. The company also offers legacy applications comprising Mission Critical HDDs and SSDs; external storage solutions under the Seagate Ultra Touch, One Touch, and Expansion product lines, as well as under the LaCie brand name; desktop drives; notebook drives, DVR HDDs, and gaming SSDs. In addition, it provides Lyve edge-to-cloud mass capacity platform. The company sells its products primarily to OEMs, distributors, and retailers. Seagate Technology Holdings plc was founded in 1978 and is based in Dublin, Ireland.

About Lenovo Group

Lenovo Group Limited, an investment holding company, develops, manufactures, and markets technology products and services. It operates through Intelligent Devices Group, Infrastructure Solutions Group, and Solutions and Services Group segments. The company offers commercial and consumer personal computers, as well as servers and workstations; and a family of mobile Internet devices, including tablets and smartphones. In addition, it provides laptops, monitors, accessories, smart home and collaboration solutions, augmented and virtual reality, commercial internet of things, and smart infrastructure data center solutions. Further, the company manufactures and distributes IT products, computers, computer hardware, and peripheral equipment; and offers IT, business planning, management, supply chain, finance, administration support, procurement agency, data management, intellectual property, and investment management services. Additionally, it is involved in the retail and service business for consumer electronic products and related digital services; development, ownership, licensing, and sale of communications hardware and software; and develops software and applications. Furthermore, the company distributes smartphone, tablet, server, and storage. It operates in China, the Asia Pacific, Europe, the Middle East, Africa, and the Americas. Lenovo Group Limited was founded in 1984 and is headquartered in Quarry Bay, Hong Kong.