Universal Electronics (NASDAQ: UEIC) and Skullcandy (NASDAQ:SKUL) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitabiliy, earnings, dividends and risk.
Insider & Institutional Ownership
92.9% of Universal Electronics shares are held by institutional investors. Comparatively, 46.7% of Skullcandy shares are held by institutional investors. 5.8% of Universal Electronics shares are held by insiders. Comparatively, 7.7% of Skullcandy shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Volatility and Risk
Universal Electronics has a beta of 1.65, meaning that its stock price is 65% more volatile than the S&P 500. Comparatively, Skullcandy has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of current ratings for Universal Electronics and Skullcandy, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Universal Electronics | 0 | 1 | 3 | 0 | 2.75 |
| Skullcandy | 0 | 1 | 0 | 0 | 2.00 |
Universal Electronics currently has a consensus price target of $75.08, suggesting a potential upside of 10.25%. Skullcandy has a consensus price target of $6.35, suggesting a potential upside of 0.16%. Given Universal Electronics’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Universal Electronics is more favorable than Skullcandy.
Profitability
This table compares Universal Electronics and Skullcandy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Universal Electronics | 2.68% | 14.40% | 7.73% |
| Skullcandy | -2.75% | -4.04% | -3.32% |
Earnings & Valuation
This table compares Universal Electronics and Skullcandy’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Universal Electronics | $662.12 million | 1.48 | $59.62 million | $1.21 | 56.28 |
| Skullcandy | N/A | N/A | N/A | $0.07 | 90.58 |
Universal Electronics has higher revenue and earnings than Skullcandy. Universal Electronics is trading at a lower price-to-earnings ratio than Skullcandy, indicating that it is currently the more affordable of the two stocks.
Summary
Universal Electronics beats Skullcandy on 10 of the 11 factors compared between the two stocks.
About Universal Electronics
Universal Electronics Inc. (UEI) develops control and sensor technology solutions and manufactures a line of pre-programmed and universal remote control products, audio-video (AV) accessories, and intelligent wireless security and automation components. The Company’s offerings include pre-programmed universal infrared (IR) and radio frequency (RF) remote controls that are sold primarily to subscription broadcasting providers, original equipment manufacturers (OEMs), retailers, and private label customers, and integrated circuits, on which its software and universal device control database is embedded, sold primarily to OEMs, subscription broadcasting providers, and private label customers. Its offerings also include software, firmware and technology solutions that enable devices, such as televisions, set-top boxes, stereos, smart phones tablets, gaming controllers and other consumer electronic devices, to wirelessly connect and interact with home networks and interactive services.
About Skullcandy
Skullcandy, Inc. creates audio experiences through its Skullcandy and Astro Gaming brands. The Company operates in two segments: Domestic and International. The Domestic segment consists of Skullcandy and Astro Gaming product sales to customers in the United States. The International segment includes Skullcandy product sales to customers in Europe, Asia, Canada Mexico, and all other geographic areas outside the United States that are served by the Company’s International operations. The Company focuses its product offerings in two categories: audio and gaming. The Company primarily operates in the consumer products category in which the Company develops and distributes headphones and other audio products. Astro Gaming creates premium video gaming equipment for professional gamers, leagues, and gaming enthusiasts. Skullcandy brand creates various audio and gaming products.
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