Financial Survey: Canon (OTCMKTS:CAJPY) and Seagate Technology (NASDAQ:STX)

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

Risk and Volatility

Seagate Technology has a beta of 2.06, indicating that its stock price is 106% more volatile than the S&P 500. Comparatively, Canon has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500.

Institutional & Insider Ownership

92.9% of Seagate Technology shares are owned by institutional investors. 0.5% of Seagate Technology shares are owned by company insiders. Comparatively, 0.0% of Canon shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Seagate Technology and Canon, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seagate Technology	0	5	22	0	2.81
Canon	0	1	0	0	2.00

Seagate Technology currently has a consensus target price of $986.00, suggesting a potential upside of 22.39%. Given Seagate Technology’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Seagate Technology is more favorable than Canon.

Valuation and Earnings

This table compares Seagate Technology and Canon”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	15.02	$3.18 billion	$13.88	58.04
Canon	$29.46 billion	0.88	$2.22 billion	$2.54	11.56

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

Dividends

Seagate Technology pays an annual dividend of $2.96 per share and has a dividend yield of 0.4%. Canon pays an annual dividend of $0.80 per share and has a dividend yield of 2.7%. Seagate Technology pays out 21.3% of its earnings in the form of a dividend. Canon pays out 31.5% 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 raised its dividend for 1 consecutive years.

Profitability

This table compares Seagate Technology and Canon’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%
Canon	7.36%	9.41%	5.53%

Summary

Seagate Technology beats Canon on 15 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 Canon

Canon Inc., together with its subsidiaries, manufactures and sells office multifunction devices (MFDs), plain paper copying machines, laser and inkjet printers, cameras, diagnostic equipment, and lithography equipment. The company operates through four segments: Printing Business Unit, Imaging Business Unit, Medical Business Unit, and Industrial and Others Business Unit. The Printing Business Unit segment offers office MFDs, document solutions, laser multifunction printers, laser printers, inkjet printers, image scanners, calculators, digital continuous feed presses, digital sheet-fed presses, and large format printers. The Imaging Business Unit segment provides interchangeable-lens digital cameras, digital compact cameras, interchangeable lenses, compact photo printers, network cameras, video management and video content analytics software, digital camcorders, digital cinema cameras, broadcast equipment, and multimedia projectors. The Medical System Business Unit segment offers computed tomography systems, diagnostic ultrasound systems, diagnostic X-ray systems, magnetic resonance imaging systems, clinical chemistry analyzers, digital radiography systems, and ophthalmic equipment. The Industry and Others Business Unit segment provides semiconductor lithography equipment, flat panel display lithography equipment, vacuum thin-film deposition equipment, organic light-emitting diode display manufacturing equipment, die bonders, handy terminals, and document scanners. The company also provides maintenance services; and supplies replacement drums, parts, toners, and papers. It sells its products under the Canon brand through subsidiaries or independent distributors to dealers and retail outlets, as well as directly to end-users globally. Canon Inc. was founded in 1933 and is headquartered in Tokyo, Japan.