Critical Comparison: Apple (NASDAQ:AAPL) vs. Super Micro Computer (NASDAQ:SMCI)

Apple (NASDAQ:AAPL) and Super Micro Computer (NASDAQ:SMCI) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, profitability, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of current recommendations for Apple and Super Micro Computer, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apple 2 9 28 0 2.67
Super Micro Computer 0 0 3 0 3.00

Apple currently has a consensus target price of $135.21, indicating a potential upside of 5.72%. Super Micro Computer has a consensus target price of $41.50, indicating a potential upside of 5.49%. Given Apple’s higher probable upside, research analysts plainly believe Apple is more favorable than Super Micro Computer.

Volatility & Risk

Apple has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500. Comparatively, Super Micro Computer has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500.

Profitability

This table compares Apple and Super Micro Computer’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apple 20.91% 75.15% 17.63%
Super Micro Computer 2.56% 12.14% 6.76%

Earnings and Valuation

This table compares Apple and Super Micro Computer’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Apple $274.52 billion 7.82 $57.41 billion $3.28 38.99
Super Micro Computer $3.34 billion 0.60 $84.31 million $2.46 15.99

Apple has higher revenue and earnings than Super Micro Computer. Super Micro Computer is trading at a lower price-to-earnings ratio than Apple, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

57.8% of Apple shares are held by institutional investors. Comparatively, 75.2% of Super Micro Computer shares are held by institutional investors. 0.1% of Apple shares are held by insiders. Comparatively, 16.7% of Super Micro Computer shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Apple beats Super Micro Computer on 10 of the 14 factors compared between the two stocks.

About Apple

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories worldwide. It also sells various related services. The company offers iPhone, a line of smartphones; Mac, a line of personal computers; iPad, a line of multi-purpose tablets; and wearables, home, and accessories comprising AirPods, Apple TV, Apple Watch, Beats products, HomePod, iPod touch, and other Apple-branded and third-party accessories. It also provides AppleCare support services; cloud services store services; and operates various platforms, including the App Store, that allow customers to discover and download applications and digital content, such as books, music, video, games, and podcasts. In addition, the company offers various services, such as Apple Arcade, a game subscription service; Apple Music, which offers users a curated listening experience with on-demand radio stations; Apple News+, a subscription news and magazine service; Apple TV+, which offers exclusive original content; Apple Card, a co-branded credit card; and Apple Pay, a cashless payment service, as well as licenses its intellectual property. The company serves consumers, and small and mid-sized businesses; and the education, enterprise, and government markets. It sells and delivers third-party applications for its products through the App Store. The company also sells its products through its retail and online stores, and direct sales force; and third-party cellular network carriers, wholesalers, retailers, and resellers. Apple Inc. was founded in 1977 and is headquartered in Cupertino, California.

About Super Micro Computer

Super Micro Computer, Inc., together with its subsidiaries, develops and manufactures high-performance server and storage solutions based on modular and open architecture. Its solutions range from complete server, storage, modular blade servers, blades, workstations, full racks, networking devices, server management software, and server sub-systems, as well as support and services. The company also provides a range of application-optimized server solutions, including rackmount and blade servers, storage systems, and subsystems and accessories; and server software management solutions, such as Server Management Suite, including Supermicro Server Manager, Supermicro Power Management software, Supermicro Update Manager, and SuperDoctor 5. In addition, it offers server subsystems and accessories comprising server boards, chassis, power supplies, and other accessories. Further, the company provides server and storage system integration, configuration, and software upgrade and update services; and technical documentation services, as well as identifies service requirements, creates and executes project plans, and conducts verification testing and training services. Additionally, it offers help desk and on-site product support services for its server and storage systems; and customer support services, including ongoing maintenance and technical support for its products. The company provides its products to enterprise data centers, cloud computing, artificial intelligence, and 5G and edge computing markets. It sells its products through direct sales force, distributors, value-added resellers, system integrators, and original equipment manufacturers. The company has operations primarily in the United States, Europe, Asia, and internationally. Super Micro Computer, Inc. was founded in 1993 and is headquartered in San Jose, California.

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