Head-To-Head Survey: NVE (NASDAQ:NVEC) versus QUALCOMM (NASDAQ:QCOM)

QUALCOMM (NASDAQ:QCOM) and NVE (NASDAQ:NVEC) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, profitability, institutional ownership, valuation, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings for QUALCOMM and NVE, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QUALCOMM	1	9	13	1	2.58
NVE	0	1	0	0	2.00

QUALCOMM currently has a consensus target price of $190.38, indicating a potential upside of 15.34%. Given QUALCOMM’s stronger consensus rating and higher possible upside, analysts clearly believe QUALCOMM is more favorable than NVE.

Insider & Institutional Ownership

74.3% of QUALCOMM shares are owned by institutional investors. Comparatively, 65.9% of NVE shares are owned by institutional investors. 0.1% of QUALCOMM shares are owned by insiders. Comparatively, 1.9% of NVE shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

QUALCOMM has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, NVE has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500.

Profitability

This table compares QUALCOMM and NVE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QUALCOMM	26.77%	40.35%	19.74%
NVE	55.79%	22.48%	21.78%

Earnings & Valuation

This table compares QUALCOMM and NVE”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QUALCOMM	$44.28 billion	3.99	$10.14 billion	$4.89	33.75
NVE	$24.78 million	11.73	$15.06 million	$2.85	21.09

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

Dividends

QUALCOMM pays an annual dividend of $3.56 per share and has a dividend yield of 2.2%. NVE pays an annual dividend of $4.00 per share and has a dividend yield of 6.7%. QUALCOMM pays out 72.8% of its earnings in the form of a dividend. NVE pays out 140.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. QUALCOMM has increased its dividend for 23 consecutive years.

Summary

QUALCOMM beats NVE on 12 of the 18 factors compared between the two stocks.

About QUALCOMM

QUALCOMM Incorporated engages in the development and commercialization of foundational technologies for the wireless industry worldwide. It operates through three segments: Qualcomm CDMA Technologies (QCT); Qualcomm Technology Licensing (QTL); and Qualcomm Strategic Initiatives (QSI). The QCT segment develops and supplies integrated circuits and system software based on 3G/4G/5G and other technologies for use in wireless voice and data communications, networking, computing, multimedia, and position location products. The QTL segment grants licenses or provides rights to use portions of its intellectual property portfolio, which include various patent rights useful in the manufacture and sale of wireless products comprising products implementing CDMA2000, WCDMA, LTE and/or OFDMA-based 5G standards and their derivatives. The QSI segment invests in early-stage companies in various industries, including 5G, artificial intelligence, automotive, consumer, enterprise, cloud, IoT, and extended reality, and investments, including non-marketable equity securities and, to a lesser extent, marketable equity securities, and convertible debt instruments. It also provides development, and other services and related products to the United States government agencies and their contractors. The company was incorporated in 1985 and is headquartered in San Diego, California.

About NVE

NVE Corporation develops and sells devices that use spintronics, a nanotechnology that relies on electron spin to acquire, store, and transmit information in the United States and internationally. The company manufactures spintronic products, including sensors and couplers for use in acquiring and transmitting data. Its products comprise standard sensors to detect the presence of a magnetic or metallic material to determine position, rotation, or speed for the factory automation market; and custom and medical sensors for medical devices to replace electromechanical magnetic switches. The company also offers spintronic couplers for power conversion and industrial Internet of Things (IIoT) market; and DC-to-DC convertors for use in power conversion systems and industrial networks for the IIoT. In addition, it undertakes contracts for research and development, and licensing of spintronic magnetoresistive random access memory technology. NVE Corporation was founded in 1989 and is headquartered in Eden Prairie, Minnesota.