Analyzing Silicon Laboratories (NASDAQ:SLAB) and Penguin Solutions (NASDAQ:PENG)

Penguin Solutions (NASDAQ:PENG) and Silicon Laboratories (NASDAQ:SLAB) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Earnings and Valuation

This table compares Penguin Solutions and Silicon Laboratories”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Penguin Solutions	$1.32 billion	0.71	-$52.47 million	($0.17)	-102.65
Silicon Laboratories	$584.39 million	5.96	-$191.01 million	($5.94)	-18.06

Penguin Solutions has higher revenue and earnings than Silicon Laboratories. Penguin Solutions is trading at a lower price-to-earnings ratio than Silicon Laboratories, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations for Penguin Solutions and Silicon Laboratories, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Penguin Solutions	0	1	6	2	3.11
Silicon Laboratories	0	3	5	0	2.63

Penguin Solutions currently has a consensus target price of $24.94, suggesting a potential upside of 42.91%. Silicon Laboratories has a consensus target price of $129.00, suggesting a potential upside of 20.27%. Given Penguin Solutions’ stronger consensus rating and higher possible upside, research analysts plainly believe Penguin Solutions is more favorable than Silicon Laboratories.

Volatility & Risk

Penguin Solutions has a beta of 1.83, indicating that its share price is 83% more volatile than the S&P 500. Comparatively, Silicon Laboratories has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Profitability

This table compares Penguin Solutions and Silicon Laboratories’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Penguin Solutions	-2.21%	11.70%	3.12%
Silicon Laboratories	-32.69%	-10.46%	-9.12%

Summary

Penguin Solutions beats Silicon Laboratories on 11 of the 13 factors compared between the two stocks.

About Penguin Solutions

Penguin Solutions, Inc. engages in the designing and development of enterprise solutions worldwide. It operates through three segments: Advanced Computing, Integrated Memory, and Optimized LED. It offers dynamic random access memory modules, solid-state and flash storage, and other advanced integrated memory solutions for networking and telecom, data analytics, artificial intelligence and machine learning applications; and supply chain services, including procurement, logistics, inventory management, temporary warehousing, programming, kitting, and packaging services. The company also provides Penguin Computing that focus on technical computing for core and cloud environments through high-performance computing and AI solutions; and Penguin Edge, an edge computing solution for embedded and wireless applications, such as high-performance products for government, health care, manufacturing, and telecommunications applications. In addition, it offers Stratus, which provides simplified, protected, and autonomous fault tolerant computing solutions in the data center and at the Edge through hardware and software services; and solutions to education, energy, financial services, government, hyperscale, and manufacturing markets. Further, the company provides LED chip products comprising blue and green LED chips based on gallium nitride, and related materials under Cree LED brand; and surface mount devices under the Cree LED XLamp and J Series brands. It sells its products directly to original equipment manufacturers, enterprise, government and other end customers through direct sales force, e-commerce, customer service representatives, on-site field application engineers, independent sales representatives, distributors, integrators, and resellers. The company was formerly known as SMART Global Holdings, Inc. and changed its name to Penguin Solutions, Inc. in October 2024. Penguin Solutions, Inc. was founded in 1988 and is based in Grand Cayman, Cayman Islands.

About Silicon Laboratories

Silicon Laboratories Inc., a fabless semiconductor company, provides various analog-intensive mixed-signal solutions in the United States, China, Taiwan, and internationally. The company's products include wireless microcontrollers and sensor products. Its products are used in various electronic products in a range of applications for the industrial Internet of Things (IoT), including industrial automation and control, smart buildings, access control, HVAC control, and industrial wearables and power tools; smart cities applications, such as smart metering, smart street lighting, renewable energy, electric vehicle supply equipment, and smart agriculture; commercial IoT applications, including smart lighting, asset tracking, electronic shelf labels, theft protection, and enterprise access points; smart home applications, comprising home automation/security systems, smart speakers, smart lighting, HVAC control, smart cameras, smart appliances, smart home sensing, smart locks, and window/blind controls; and connected health applications, including diabetes management, consumer health and fitness, elderly care, patient monitoring, and activity tracking; as well as in commercial building automation, consumer electronics, and medical instrumentation. The company sells its products through its direct sales force, as well as through a network of independent sales representatives and distributors. Silicon Laboratories Inc. was founded in 1996 and is headquartered in Austin, Texas.