Dolby Laboratories (DLB) vs UL Solutions Inc. (ULS)

Dolby Laboratories and UL Solutions Inc. are both Specialty Business Services companies. UL Solutions Inc. is the larger, with a market value of $13.3B against $5.4B — 2.5× the size. Dolby Laboratories trades at the lower P/E: 24.6× against 26.3×. UL Solutions Inc. grew revenue faster over the last twelve months: 6.61% against 0.55%. Dolby Laboratories has the higher net margin (16.7% vs 16.1%) and the lower return on invested capital (8.06% vs 23.6%). Across the 20 metrics below, Dolby Laboratories leads on 14 and UL Solutions Inc. on 6.

Valuation

Metric DLB ULS Specialty Business Services median
P/E 24.61 26.31 23.86
P/S 4.07 4.24 1.06
P/B 2.13 8.24 2.37
Price to free cash flow 15.28 30.60 16.54
EV/EBITDA 13.96 17.63 11.51
EV/Sales 3.53 4.21 1.51
Earnings yield 4.06% 3.80% 2.14%
Free cash flow yield 6.54% 3.27% 1.55%

Profitability

Metric DLB ULS Specialty Business Services median
Gross margin 87.61% 50.41% 35.31%
Operating margin 17.65% 17.86% 3.43%
Net margin 16.70% 16.05% 1.67%
Free cash flow margin 26.66% 13.86% 3.28%
Return on equity 8.69% 36.96% 0.58%
Return on assets 7.12% 16.72% 0.33%
Return on invested capital 8.06% 23.62% 0.65%

Growth

Metric DLB ULS Specialty Business Services median
Revenue growth (TTM) 0.55% 6.61% 6.04%
EPS growth (last fiscal year) (2.60%) (1.23%) —
Revenue growth, 5-year CAGR 3.04% — 7.66%
Net income growth, 5-year CAGR 1.97% — 0.00%

Health

Metric DLB ULS Specialty Business Services median
Debt to equity 0.00 0.19 0.21
Current ratio 3.19 1.42 1.62
Net debt to EBITDA (2.18) 0.28 1.16

Dividend

Metric DLB ULS Specialty Business Services median
Dividend yield 1.38% — 1.61%
Payout ratio 0.47 — 0.00

Size

Metric DLB ULS Specialty Business Services median
Market cap 5.38b 13.29b 879.14m

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