SemiLEDS Corporation (NASDAQ: LEDS) and Skyworks Solutions (NASDAQ:SWKS) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, institutional ownership, earnings, risk and profitability.

Dividends

Skyworks Solutions pays an annual dividend of $1.28 per share and has a dividend yield of 1.2%. SemiLEDS Corporation does not pay a dividend. Skyworks Solutions pays out 24.6% of its earnings in the form of a dividend.

Volatility and Risk

SemiLEDS Corporation has a beta of 2.24, suggesting that its stock price is 124% more volatile than the S&P 500. Comparatively, Skyworks Solutions has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500.

Earnings & Valuation

This table compares SemiLEDS Corporation and Skyworks Solutions’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
SemiLEDS Corporation $8.53 million 0.87 -$4.18 million ($5.04) -0.42
Skyworks Solutions $3.50 billion 5.42 $1.45 billion $5.21 19.80

Skyworks Solutions has higher revenue and earnings than SemiLEDS Corporation. SemiLEDS Corporation is trading at a lower price-to-earnings ratio than Skyworks Solutions, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares SemiLEDS Corporation and Skyworks Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SemiLEDS Corporation -182.84% -59.70% -30.13%
Skyworks Solutions 27.86% 28.67% 26.04%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for SemiLEDS Corporation and Skyworks Solutions, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SemiLEDS Corporation 0 0 0 0 N/A
Skyworks Solutions 2 4 19 1 2.73

Skyworks Solutions has a consensus target price of $109.83, indicating a potential upside of 6.44%. Given Skyworks Solutions’ higher probable upside, analysts clearly believe Skyworks Solutions is more favorable than SemiLEDS Corporation.

Insider & Institutional Ownership

2.6% of SemiLEDS Corporation shares are held by institutional investors. Comparatively, 81.2% of Skyworks Solutions shares are held by institutional investors. 40.1% of SemiLEDS Corporation shares are held by company insiders. Comparatively, 0.5% of Skyworks Solutions shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Skyworks Solutions beats SemiLEDS Corporation on 12 of the 15 factors compared between the two stocks.

About SemiLEDS Corporation

SemiLEDs Corporation develops, manufactures and sells light emitting diode (LED) chips and LED components. The Company’s products are used primarily for general lighting applications, including street lights and commercial, industrial and residential lighting. Its LED chips may also be used in specialty industrial applications, such as ultraviolet (UV), curing of polymers, LED light therapy in medical/cosmetic applications, counterfeit detection, LED lighting for horticulture applications, architectural lighting and entertainment lighting. The Company produces a range of blue, white, green and UV LED chips, including its Enhanced Vertical (EV) LED product series, ranging from chip sizes of approximately 380 microns (um) by 380um to 1,520um by 1,520um. It designs, assembles and sells lighting fixtures and systems for general lighting applications, including commercial, residential and industrial lighting. Its lighting products consist primarily of LED luminaries and LED retrofits.

About Skyworks Solutions

Skyworks Solutions Inc. designs, develops, manufactures and markets semiconductor products, including intellectual property. The Company’s analog semiconductors are connecting people, places, and things, spanning a number of new and unimagined applications within the automotive, broadband, cellular infrastructure, connected home, industrial, medical, military, smartphone, tablet and wearable markets. Its geographical segments include the United States, Other Americas, China, Taiwan, South Korea, Other Asia-Pacific, Europe, Middle East and Africa. It operates throughout the world with engineering, manufacturing, sales and service facilities throughout Asia, Europe and North America. It is engaged with key original equipment manufacturers (OEM), smartphone providers and baseband reference design partners. Its product portfolio consists of various solutions, including amplifiers, attenuators, detectors, diodes, filters, front-end modules, hybrid, mixers, switches, and modulators.

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