Autodesk (NASDAQ:ADSK) and Penguin Solutions (NASDAQ:PENG) Critical Review

Autodesk (NASDAQ:ADSK) and Penguin Solutions (NASDAQ:PENG) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.

Risk and Volatility

Autodesk has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500. Comparatively, Penguin Solutions has a beta of 2.2, meaning that its stock price is 120% more volatile than the S&P 500.

Earnings & Valuation

This table compares Autodesk and Penguin Solutions”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Autodesk	$6.13 billion	10.82	$1.11 billion	$4.83	64.47
Penguin Solutions	$1.37 billion	0.87	-$52.47 million	($0.28)	-80.96

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

Insider & Institutional Ownership

90.2% of Autodesk shares are held by institutional investors. 0.2% of Autodesk shares are held by company insiders. Comparatively, 2.6% of Penguin Solutions shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Autodesk	15.75%	51.23%	12.77%
Penguin Solutions	1.82%	13.56%	4.22%

Analyst Ratings

This is a summary of recent ratings for Autodesk and Penguin Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Autodesk	0	6	18	1	2.80
Penguin Solutions	1	2	7	1	2.73

Autodesk currently has a consensus target price of $359.13, indicating a potential upside of 15.32%. Penguin Solutions has a consensus target price of $28.00, indicating a potential upside of 23.51%. Given Penguin Solutions’ higher probable upside, analysts plainly believe Penguin Solutions is more favorable than Autodesk.

Summary

Autodesk beats Penguin Solutions on 10 of the 14 factors compared between the two stocks.

About Autodesk

Autodesk, Inc. provides 3D design, engineering, and entertainment technology solutions worldwide. The company offers AutoCAD Civil 3D, a surveying, design, analysis, and documentation solution for civil engineering, including land development, transportation, and environmental projects; BuildingConnected, a SaaS preconstruction solution; AutoCAD, a software for professional design, drafting, detailing, and visualization; AutoCAD LT, a drafting and detailing software; computer-aided manufacturing (CAM) software for computer numeric control machining, inspection, and modelling for manufacturing; Fusion 360, a 3D CAD, CAM, and computer-aided engineering tool; and Industry Collections tools for professionals in architecture, engineering and construction, product design and manufacturing, and media and entertainment collection industries. It also provides Inventor tools for 3D mechanical design, simulation, analysis, tooling, visualization, and documentation; Vault, a data management software to manage data in one central location, accelerate design processes, and streamline internal/external collaboration; Maya and 3ds Max software products that offer 3D modeling, animation, effects, rendering, and compositing solutions; and ShotGrid, a cloud-based software for review and production tracking in the media and entertainment industry. It sells its products and services to customers directly, as well as through a network of resellers and distributors. Autodesk, Inc. was incorporated in 1982 and is headquartered in San Francisco, California.

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.