Contrasting SYNNEX (NYSE:SNX) & Hewlett Packard Enterprise (NYSE:HPE)

Hewlett Packard Enterprise (NYSE:HPE) and SYNNEX (NYSE:SNX) are both computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Insider & Institutional Ownership

80.4% of Hewlett Packard Enterprise shares are owned by institutional investors. Comparatively, 74.9% of SYNNEX shares are owned by institutional investors. 0.4% of Hewlett Packard Enterprise shares are owned by company insiders. Comparatively, 2.8% of SYNNEX shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Hewlett Packard Enterprise and SYNNEX’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hewlett Packard Enterprise $29.14 billion 0.44 $1.05 billion $1.77 5.58
SYNNEX $23.76 billion 0.27 $500.71 million $13.26 9.41

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

Risk and Volatility

Hewlett Packard Enterprise has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, SYNNEX has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500.

Profitability

This table compares Hewlett Packard Enterprise and SYNNEX’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hewlett Packard Enterprise -0.13% 12.35% 4.03%
SYNNEX 2.03% 17.29% 5.49%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Hewlett Packard Enterprise and SYNNEX, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hewlett Packard Enterprise 2 14 4 0 2.10
SYNNEX 0 1 5 1 3.00

Hewlett Packard Enterprise presently has a consensus target price of $12.78, suggesting a potential upside of 29.43%. SYNNEX has a consensus target price of $134.17, suggesting a potential upside of 7.56%. Given Hewlett Packard Enterprise’s higher probable upside, equities research analysts clearly believe Hewlett Packard Enterprise is more favorable than SYNNEX.

Summary

SYNNEX beats Hewlett Packard Enterprise on 10 of the 15 factors compared between the two stocks.

Hewlett Packard Enterprise Company Profile

Hewlett Packard Enterprise Company operates as a technology company. The company operates through four segments: Hybrid IT, Intelligent Edge, Financial Services, and Corporate Investments. The Hybrid IT segment provides industry standard servers for multi-workload computing; mission-critical servers; converged storage solutions, including all-flash arrays and hybrid storage solutions; and traditional storage solutions comprising tape, storage networking, and disk products, such as HPE MSA and HPE XP. It also offers data center networking products, such as top-of-rack switches, core switches, and open networking switches; and operational services, advisory and professional services, and communications and media solutions. The Intelligent Edge segment provides solutions for mobility and Internet of things, as well as enterprise networking and security solutions for businesses campus and branch environments under the Aruba brand. This segment also offers wired and wireless local area network products, such as Wi-Fi access points, switches, routers; and software products, including network management, network access control, analytics and assurance, and location services software. The Financial Services segment offers various flexible investment solutions, which comprise leasing, financing, IT consumption, and utility programs and asset management services for customers to enable the creation of unique technology deployment models and acquire complete IT solutions. The Corporate Investments segment is involved in Hewlett Packard labs and various business incubation activities. The company serves small and medium-sized businesses and large enterprises. It has strategic alliance with ABB Ltd. Hewlett Packard Enterprise Company was founded in 1939 and is headquartered in Palo Alto, California.

SYNNEX Company Profile

SYNNEX Corporation provides business process services in the Americas, Asia-Pacific, Europe and Africa. It operates in two segments, Technology Solutions and Concentrix. The Technology Solutions segment distributes peripherals; information technology systems, including data center servers and storage solutions; system components; software; networking, communications, and security equipment; consumer electronics; and complementary products. It also provides systems design and integration solutions, build-to-order, and configure-to-order assembly capabilities; logistics services that include outsourced fulfillment, virtual distribution, and direct ship to end-users; cloud services; online services; and financing services comprising net terms, third party leasing, floor plan financing, and letters of credit backed financing and arrangements. In addition, this segment offers marketing services, such as direct mail, external media advertising, reseller product training, targeted telemarketing campaigns, trade shows, trade groups, database analysis, print on demand services, and Web-based marketing. This segment serves resellers, system integrators, and retailers. The Concentrix segment offers a portfolio of strategic solutions and end-to-end business outsourcing services focused on customer engagement, process optimization, technology innovation, front and back-office automation, and business transformation services. This segment serves clients in various industry verticals, including automotive, banking and financial services, consumer electronics, energy and public sector, healthcare, insurance, media and communications, retail and e-commerce, and technology, as well as travel, transportation, and tourism. The company was formerly known as SYNNEX Information Technologies, Inc. and changed its name to SYNNEX Corporation in October 2003. SYNNEX Corporation was founded in 1980 and is headquartered in Fremont, California.

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