Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, audio technology company Dolby Labs (NYSE: DLB) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.
With that in mind, let's take a closer look at Dolby's business and see what CAPS investors are saying about the stock right now.
Dolby facts
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Headquarters (founded)
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San Francisco, California (1965)
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Market Cap
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$3.10 billion
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Industry
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Diversified Electronics
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TTM Revenue
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$640.2 million
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Management
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Founder/Chairman Ray Dolby
CEO N. William Jasper
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Return on Equity (average last three years)
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19.7%
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Competitors
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Sony (NYSE: SNE),
DTS (Nasdaq: DTSI)
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CAPS members bullish on DLB also bullish on
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Apple (Nasdaq: AAPL),
Cemex (NYSE: CX)
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CAPS members bearish on DLB also bearish on
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Ford Motor (NYSE: F),
Netflix (Nasdaq: NFLX)
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Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.
Over on CAPS, fully 2,738 of the 2,800 members who have rated Dolby -- some 98% -- believe the stock will outperform the S&P 500 going forward. These Foolish bulls include jagdme and InternetSecurity.
Last week, jagdme ran down Dolby's sweet, and simple-sounding, bull case: Brand moat, solid fundamentals, good management. Poised to ride out the economic woes and thrive long-term.
In an earlier pitch from September, InternetSecurity agrees, citing Dolby's underrated brand-power as the real reason to remain bullish:
How Dolby has held onto its intellectual property and licensing even beyond the 17 years a patent would last is a mystery to me. I think it is a brand that is barely noticed by the mass consumer market even though the logo is on much of what they own. I suspect Dolby's licensing agreements of being deeply ingrained in systems and that somebody is making sure they stay that way. That will be the reason for their continued existence and success - not technological superiority or the inability of anyone to copy their technology.
What do you think about Dolby, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.
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