Critical Contrast: Check Point Software Technologies (CHKP) & Adobe Systems (ADBE)
Check Point Software Technologies (NASDAQ: CHKP) and Adobe Systems (NASDAQ:ADBE) are both large-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.
Valuation and Earnings
This table compares Check Point Software Technologies and Adobe Systems’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Check Point Software Technologies||$1.81 billion||10.11||$893.47 million||$4.50||24.89|
|Adobe Systems||$6.90 billion||10.62||$2.32 billion||$3.19||46.55|
Adobe Systems has higher revenue and earnings than Check Point Software Technologies. Check Point Software Technologies is trading at a lower price-to-earnings ratio than Adobe Systems, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
67.8% of Check Point Software Technologies shares are owned by institutional investors. Comparatively, 87.4% of Adobe Systems shares are owned by institutional investors. 29.0% of Check Point Software Technologies shares are owned by company insiders. Comparatively, 0.4% of Adobe Systems shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Risk and Volatility
Check Point Software Technologies has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, Adobe Systems has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.
This is a breakdown of recent recommendations for Check Point Software Technologies and Adobe Systems, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Check Point Software Technologies||0||15||14||0||2.48|
Check Point Software Technologies currently has a consensus target price of $111.24, indicating a potential downside of 0.67%. Adobe Systems has a consensus target price of $159.57, indicating a potential upside of 7.46%. Given Adobe Systems’ stronger consensus rating and higher possible upside, analysts clearly believe Adobe Systems is more favorable than Check Point Software Technologies.
This table compares Check Point Software Technologies and Adobe Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Check Point Software Technologies||42.17%||22.02%||14.91%|
Adobe Systems beats Check Point Software Technologies on 9 of the 14 factors compared between the two stocks.
Check Point Software Technologies Company Profile
Check Point Software Technologies Ltd. (Check point) develops, markets and supports a range of products and services for information technology (IT) security. The Company’s products and services are sold to enterprises, service providers, small and medium sized businesses and consumers. It offers enterprises a platform to deploy independent, modular and interoperable security applications (Software Blades), such as firewall, virtual private network (VPN), intrusion prevention system (IPS), Application Control, Anti-Bot, antivirus, data loss prevention (DLP), policy management, event analysis or multi-domain management. The Company offers Software Blades grouped into functional packages to address specific security issues. It has product offerings under these packages, which include Next Generation Firewall, Next Generation Threat Prevention, Next Generation Secure Web Gateway and Next Generation Data Protection.
Adobe Systems Company Profile
Adobe Systems Incorporated is a software company. The Company offers products and services used by professionals, marketers, knowledge workers, application developers, enterprises and consumers for creating, managing, delivering, measuring, optimizing and engaging with compelling content and experiences. It operates through three segments: Digital Media, Digital Marketing, and Print and Publishing. Its Digital Media segment provides tools and solutions that enable individuals, small and medium businesses and enterprises to create, publish, promote and monetize their digital content. Its Digital Marketing segment provides solutions and services for how digital advertising and marketing are created, managed, executed, measured and optimized. Its Print and Publishing segment addresses market opportunities ranging from the diverse authoring and publishing needs of technical and business publishing to its legacy type and original equipment manufacturer (OEM) printing businesses.
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