Head-To-Head Review: SolarWinds (SWI) vs. Its Peers

SolarWinds (NYSE: SWI) is one of 100 publicly-traded companies in the “Enterprise Software” industry, but how does it contrast to its rivals? We will compare SolarWinds to similar companies based on the strength of its analyst recommendations, valuation, institutional ownership, profitability, earnings, dividends and risk.

Profitability

This table compares SolarWinds and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SolarWinds 20.52% 19.24% 12.70%
SolarWinds Competitors -20.82% -214.61% -6.60%

Institutional and Insider Ownership

60.9% of shares of all “Enterprise Software” companies are held by institutional investors. 21.9% of shares of all “Enterprise Software” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk & Volatility

SolarWinds has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500. Comparatively, SolarWinds’ rivals have a beta of 1.06, suggesting that their average share price is 6% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for SolarWinds and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SolarWinds 0 0 0 0 N/A
SolarWinds Competitors 364 2182 4114 119 2.59

As a group, “Enterprise Software” companies have a potential downside of 0.13%. Given SolarWinds’ rivals higher probable upside, analysts plainly believe SolarWinds has less favorable growth aspects than its rivals.

Valuation & Earnings

This table compares SolarWinds and its rivals revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
SolarWinds N/A N/A 50.83
SolarWinds Competitors $1.82 billion $300.56 million 18.50

SolarWinds’ rivals have higher revenue and earnings than SolarWinds. SolarWinds is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

About SolarWinds

SolarWinds, Inc. (SolarWinds) is a holding company. The Company designs, develops, markets, sells and supports enterprise-class information technology (IT), infrastructure management software to IT and DevOps professionals in organizations of all sizes. Its products categories include network management, which is used to monitor and manage the performance of network infrastructure; systems management, which is used to monitor and manage the performance of applications, physical and virtual servers, storage and databases; MSP, which is used by managed service providers to monitor and manage the IT infrastructure of their end clients, SMBs, and cloud, its cloud-based products, which are used to monitor and manage applications and application infrastructure. Its customers include small- and mid-size businesses, enterprises, MSPs, and local, state and federal Government entities.

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