Sony Vs Dolby Digital: Which A/V Stock Is Worth A Buy Now?
Zacks Investment Research | Nov 26, 2017 10:37PM ET
Most investors look for companies and industries that consistently yield high returns over a considerable time period. Currently, the Consumer Discretionary space is grabbing the limelight, owing to an improving economy, along with a declining unemployment rate, improving consumer spending and enhanced consumer confidence. Moreover, expectedly slow and gradual interest rate hikes by the Federal Reserve ensures enough time for consumers to absorb them.
Each of these factors influences consumers’ willingness to spend, and their favorable trends bode well for this sector, which manufactures products that consumers purchase because they want to and not just they need to.
Today we will look at two companies in consumer discretionary space – Sony Corporation (NYSE:SNE) and Dolby Laboratories (NYSE:DLB) . At present, Sony has a market capitalization of $61.88 billion, while that of Dolby is $6.45 billion. Let's see how these two companies fare on some key metrics.
Trailing 12-Month Return
In the last 12 months, Sony’s stock has gained 61.9%, much better than Dolby’s return of 35.4%
Sony’s return also trumped the industry’s increase of 58.0% during the same time frame, while Dolby underperformed.
Valuation
Although both the companies are trading at a discount compared with the industry’s multiple of 58.2, Sony’s stock is presently trading at a forward P/E multiple of 26.9, which is lower than Dolby, which is trading a multiple of 30.4.
Rank & Sub-industry Ranking
While both Sony and Dolby currently carry a Zacks Rank #3 (Hold), the Zacks Investment Research
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