Based on the aggregated intelligence of 165,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, audio technology specialist Dolby Laboratories (NYSE: DLB ) has earned a coveted five-star ranking.
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 (1965)
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Market Cap
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$6.2 billion
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Industry
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Electronic components
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Trailing-12-Month Revenue
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$858.8 million
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Management
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CEO Kevin Yeaman (since 2009)
CFO Murray Demo (since 2009)
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Return on Equity (Average, Past 3 Years)
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21%
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Cash/Debt
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$822.9 million / $6.1 million
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Competitors
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DTS (Nasdaq: DTSI )
Sony (NYSE: SNE )
SRS Labs (Nasdaq: SRSL )
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Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.
On CAPS, 97.6% of the 3,478 members who have rated Dolby believe the stock will outperform the S&P 500 going forward. These bulls include trurl9 and AlphaCenturion.
A couple of months ago, trurl9 tapped the stock as a rather sweet-sounding selection: "Dolby is in Windows and 3-D movies; international growth in India, China and everywhere; growth year after year; Dolby trends toward ubiquity; excellent ownership and direction. Core stock."
In fact, Dolby's position in Microsoft's (Nasdaq: MSFT ) Windows 7 drives the majority of revenue in its highly attractive mobile devices segment. And while Dolby no longer holds a monopoly on the Blu-ray, which now also supports the DTS audio format, the company's brand recognition remains second to none. At a P/E of 24, Dolby is by no means a bargain. But with Dolby's shares lagging DTS' -- as well as rivals Sony and SRS Labs -- over the past three months, now might be a good time to start listening to the bull case a little more closely.
CAPS member AlphaCenturion explains:
The company is currently facing heavy competition on the digital cinema front as well as slowing growth in the PC and consumer electronics market. What Dolby has going for it though is a large, diversified portfolio of products and services along with prestige built upon years of outstanding quality and excellence. Given their reputation and top notch management, however, I have no doubt in my mind that Dolby will continue to innovate and outperform for many years to come. Based on that I would never bet against them but I am waiting for a slightly more attractive price point before jumping in.
What do you think about Dolby, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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