Head-To-Head Analysis: Broadcom (NASDAQ:AVGO) vs. Sono-Tek (NASDAQ:SOTK)

Broadcom (NASDAQ:AVGO) and Sono-Tek (NASDAQ:SOTK) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, dividends, risk, profitability, analyst recommendations, earnings and institutional ownership.

Profitability

This table compares Broadcom and Sono-Tek’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadcom	36.20%	37.45%	16.51%
Sono-Tek	7.33%	8.38%	6.41%

Risk and Volatility

Broadcom has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500. Comparatively, Sono-Tek has a beta of -0.27, indicating that its stock price is 127% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for Broadcom and Sono-Tek, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadcom	0	1	29	3	3.06
Sono-Tek	0	4	0	0	2.00

Broadcom presently has a consensus target price of $436.33, suggesting a potential upside of 23.91%. Sono-Tek has a consensus target price of $7.50, suggesting a potential upside of 84.73%. Given Sono-Tek’s higher probable upside, analysts clearly believe Sono-Tek is more favorable than Broadcom.

Institutional & Insider Ownership

76.4% of Broadcom shares are owned by institutional investors. Comparatively, 47.9% of Sono-Tek shares are owned by institutional investors. 2.0% of Broadcom shares are owned by insiders. Comparatively, 5.5% of Sono-Tek shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Broadcom and Sono-Tek”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadcom	$63.89 billion	26.13	$23.13 billion	$4.76	73.98
Sono-Tek	$20.61 million	3.09	$1.27 million	$0.10	40.60

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

Summary

Broadcom beats Sono-Tek on 13 of the 15 factors compared between the two stocks.

About Broadcom

Broadcom Inc. designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software. It provides set-top box system-on-chips (SoCs); cable, digital subscriber line, and passive optical networking central office/consumer premise equipment SoCs; wireless local area network access point SoCs; Ethernet switching and routing custom silicon solutions; serializer/deserializer application specific integrated circuits; optical and copper, and physical layer devices; and fiber optic components and RF semiconductor devices. The company also offers RF front end modules and filter; Wi-Fi, Bluetooth, and global positioning system/global navigation satellite system SoCs; custom touch controllers; inductive charging; attached small computer system interface, and redundant array of independent disks controllers and adapters; peripheral component interconnect express; fiber channel host bus adapters; read channel based SoCs; custom flash controllers; preamplifiers; optocouplers, industrial fiber optics, and motion control encoders and subsystems; light emitting diode, ethernet PHYs, switch ICs, and camera microcontrollers. Its products are used in various applications, including enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. Broadcom Inc. was founded in 1961 and is headquartered in Palo Alto, California.

About Sono-Tek

Sono-Tek Corporation designs and manufactures ultrasonic coating systems for applying on parts and components for the microelectronics/electronics, alternative energy, medical, industrial, and research and development/other markets worldwide. The company also designs and manufactures custom-engineered ultrasonic coating systems; and provides nozzles and generators for manufacturers' equipment. Its products include integrated multi-axis coating systems, integrated coating systems, fluxing systems, OEM systems, and other related systems. In addition, the company provides surface coating solutions and application consulting services. It markets and distributes its products through direct sales personnel, select independent distributors, and sales representatives. The company was incorporated in 1975 and is based in Milton, New York.