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Head to Head Review: Electronic Arts (EA) vs. Autodesk (ADSK)

Autodesk (NASDAQ: ADSK) and Electronic Arts (NASDAQ:EA) are both large-cap computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, dividends, profitabiliy, earnings, risk, analyst recommendations and institutional ownership. Institutional and Insider Ownership

97.9% of Autodesk shares are owned by institutional investors. Comparatively, 98.0% of Electronic Arts shares are owned by institutional investors.

6.1% of Autodesk shares are owned by insiders. Comparatively, 2.6% of Electronic Arts shares are owned by insiders.

Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth. Profitability This table compares Autodesk and Electronic Arts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Autodesk -26.99% -36.65% -6.97%
Electronic Arts 23.31% 29.77% 15.74%

Volatility & Risk

Autodesk has a beta of 1.96, meaning that its stock price is 96% more volatile than the S&P 500. Comparatively, Electronic Arts has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500. Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Autodesk and Electronic Arts, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Autodesk 1 4 15 0 2.70
Electronic Arts 0 4 19 0 2.83

Autodesk currently has a consensus price target of £106.72, suggesting a potential downside of 2.82%. Electronic Arts has a consensus price target of £114.01, suggesting a potential downside of 2.52%. Given Electronic Arts’ stronger consensus rating and higher probable upside, analysts plainly believe Electronic Arts is more favorable than Autodesk.

Valuation and Earnings This table compares Autodesk and Electronic Arts’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Autodesk £2.00 billion 12.10 -£294.20 million (£2.44) -45.01
Electronic Arts £5.02 billion 7.20 £1.56 billion £3.74 31.27

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

Summary Electronic Arts beats Autodesk on 10 of the 13 factors compared between the two stocks. About Autodesk

Autodesk logoAutodesk, Inc. is a design software and services company, offering customers productive business solutions through technology products and services. The Company’s segments include Architecture, Engineering and Construction (AEC), Platform Solutions and Emerging Business (PSEB), Manufacturing (MFG), and Media and Entertainment (M&E). The Company serves customers in the architecture, engineering and construction; product design and manufacturing; and digital media and entertainment industries.

The Company’s product development and manufacturing software provides manufacturers in automotive, transportation, industrial machinery, consumer products and building products with digital engineering solutions. The Company’s product offerings include, AutoCAD, AutoCAD LT, Industry Collections, 3ds Max, Maya, Revit, Inventor, AutoCAD Civil three dimensional (3D), CAM Solutions, Fusion 360, BIM 360 and Shotgun. About Electronic Arts

Electronic Arts logoElectronic Arts Inc. develops, markets, publishes and distributes games, content and services that can be played by consumers on a range of platforms, which include consoles, personal computers (PCs), mobile phones and tablets. The Company’s games and services are based on a portfolio of intellectual property that includes established brands, such as FIFA, Madden NFL, Star Wars, Battlefield, the Sims and Need for Speed. The Company markets and sells its games and services through retail channels and through digital distribution channels.

The Company’s PC games and additional content can be downloaded directly through its Origin online platform, as well as through third-party online download stores.

Its mobile, tablet and PC free-to-download games and additional content are available through third-party application storefronts, such as the Apple Application Store and Google Play.

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References

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