Celestica (NYSE: CLS) and Microsemi Corporation (NASDAQ:MSCC) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, analyst recommendations and risk.

Volatility & Risk

Celestica has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, Microsemi Corporation has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Celestica and Microsemi Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Celestica 0 9 2 0 2.18
Microsemi Corporation 0 2 13 0 2.87

Celestica currently has a consensus target price of $14.02, suggesting a potential upside of 15.83%. Microsemi Corporation has a consensus target price of $58.27, suggesting a potential upside of 19.41%. Given Microsemi Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe Microsemi Corporation is more favorable than Celestica.

Insider & Institutional Ownership

59.8% of Celestica shares are owned by institutional investors. Comparatively, 98.6% of Microsemi Corporation shares are owned by institutional investors. 1.0% of Celestica shares are owned by company insiders. Comparatively, 0.6% of Microsemi Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Celestica and Microsemi Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Celestica $6.21 billion 0.28 $256.20 million $0.92 13.15
Microsemi Corporation $1.79 billion 3.15 $550.50 million $1.06 46.04

Microsemi Corporation has higher revenue, but lower earnings than Celestica. Celestica is trading at a lower price-to-earnings ratio than Microsemi Corporation, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Celestica and Microsemi Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Celestica 2.12% 13.64% 6.09%
Microsemi Corporation 6.90% 19.91% 8.20%

Summary

Microsemi Corporation beats Celestica on 12 of the 14 factors compared between the two stocks.

About Celestica

Celestica Inc. is a provider of supply chain solutions. The Company operates in electronics manufacturing services business segment. The Company offers a range of services to its customers, including design and development, engineering services, supply chain management, new product introduction, component sourcing, electronics manufacturing, assembly and test, complex mechanical assembly, systems integration, precision machining, order fulfillment, logistics and after-market repair and return services. Its products and services serve a range of applications, including servers; storage systems; optical equipment; aerospace and defense electronics; healthcare products and applications; semiconductor equipment, and a range of industrial and alternative energy products, including solar panels and inverters. It designs, manufactures and tests solar panels for the residential, commercial and utility scale markets. It uses technologies in the assembly and testing of its products.

About Microsemi Corporation

Microsemi Corporation is a designer, manufacturer and marketer of analog and mixed-signal semiconductor solutions differentiated by power, security, reliability and performance. The Company offers a portfolio of semiconductor and system solutions for aerospace and defense, communications, data center and industrial markets. Its products include high-performance and radiation-hardened analog mixed-signal integrated circuits (ICs), field programmable gate arrays (FPGAs), system on chip solutions (SoCs) and application-specific integrated circuits (ASICs) and power management products. The Company’s marketed products include Switchtec PFX PCIe switch, Flashtec NVM Express (NVMe)2032 and NVMe2016 controllers, Flashtec NVM Express (NVMe)2108 eight channel and NVMe2104 four channel controllers, PDS-EM-8100 PoE 2.5 gigabits per second (Gbps) Multiplexer, Chip Scale Atomic Clock (CSAC) components and miTimePLL.

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