Advanced Semiconductor Engineering (NYSE: ASX) and MaxLinear (NYSE:MXL) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, institutional ownership, profitability, dividends, analyst recommendations and valuation.

Insider & Institutional Ownership

5.9% of Advanced Semiconductor Engineering shares are held by institutional investors. Comparatively, 85.5% of MaxLinear shares are held by institutional investors. 22.9% of Advanced Semiconductor Engineering shares are held by company insiders. Comparatively, 11.9% of MaxLinear shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Advanced Semiconductor Engineering pays an annual dividend of $0.16 per share and has a dividend yield of 2.7%. MaxLinear does not pay a dividend. Advanced Semiconductor Engineering pays out 36.4% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Advanced Semiconductor Engineering and MaxLinear’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Advanced Semiconductor Engineering $9.41 billion 1.04 $1.84 billion $0.44 13.68
MaxLinear $376.48 million 4.03 $86.87 million $0.54 43.20

Advanced Semiconductor Engineering has higher revenue and earnings than MaxLinear. Advanced Semiconductor Engineering is trading at a lower price-to-earnings ratio than MaxLinear, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Advanced Semiconductor Engineering has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500. Comparatively, MaxLinear has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Advanced Semiconductor Engineering and MaxLinear, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Advanced Semiconductor Engineering 0 1 0 0 2.00
MaxLinear 0 0 7 0 3.00

MaxLinear has a consensus target price of $30.42, suggesting a potential upside of 30.38%. Given MaxLinear’s stronger consensus rating and higher possible upside, analysts clearly believe MaxLinear is more favorable than Advanced Semiconductor Engineering.

Profitability

This table compares Advanced Semiconductor Engineering and MaxLinear’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Advanced Semiconductor Engineering 8.48% 14.06% 6.76%
MaxLinear 9.95% 22.29% 14.64%

Summary

MaxLinear beats Advanced Semiconductor Engineering on 12 of the 16 factors compared between the two stocks.

About Advanced Semiconductor Engineering

Advanced Semiconductor Engineering, Inc. is a provider of semiconductor packaging and testing services. The Company offers a range of semiconductors packaging, testing and electronic manufacturing services (EMS). The Company’s segments include Packaging, Testing, EMS and Others. The Company provides services in packaging bare semiconductors into finished semiconductors with a range of electrical and thermal characteristics, as well as testing services, including front-end engineering testing, wafer probing and final testing services. It also sells goods from EMS. The Company engages in other activities, such as substrate production and real estate business. It provides integrated solutions for EMS in relation to computers, peripherals, communications, industrial, automotive, and storage and server applications. The Company provides front-end engineering testing services, including customized software development, electrical design validation, and reliability and failure analysis.

About MaxLinear

MaxLinear, Inc. is a provider of radio frequency (RF) and mixed-signal integrated circuits for cable and satellite broadband communications and the connected home, and wired and wireless infrastructure markets. The Company’s RF receiver products capture and process digital and analog broadband signals to be decoded for various applications. These products include both RF receivers and RF receiver systems-on-chip (SoCs), which incorporate its radio system architecture and the functionality necessary to receive and demodulate broadband signals, modem solutions, and physical medium devices that provide a constant current source, current-to-voltage regulation, and data alignment and retiming functionality in optical interconnect applications. It provides semiconductor solutions for the connected home, specifically Multimedia over Coax Alliance (MoCA) solutions. It sells its products to original equipment manufacturers (OEMs), module makers and original design manufacturers (ODMs).

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