Kulicke and Soffa Industries (NASDAQ: KLIC) and Chipmos Technologies (NASDAQ:IMOS) are both computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Risk & Volatility

Kulicke and Soffa Industries has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Chipmos Technologies has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500.

Insider & Institutional Ownership

84.9% of Kulicke and Soffa Industries shares are owned by institutional investors. Comparatively, 19.4% of Chipmos Technologies shares are owned by institutional investors. 1.0% of Kulicke and Soffa Industries shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Chipmos Technologies pays an annual dividend of $1.49 per share and has a dividend yield of 7.6%. Kulicke and Soffa Industries does not pay a dividend. Chipmos Technologies pays out 59.1% of its earnings in the form of a dividend.

Profitability

This table compares Kulicke and Soffa Industries and Chipmos Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kulicke and Soffa Industries 11.61% 11.88% 9.53%
Chipmos Technologies 19.20% 9.74% 5.09%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Kulicke and Soffa Industries and Chipmos Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kulicke and Soffa Industries 0 1 1 0 2.50
Chipmos Technologies 0 0 0 0 N/A

Kulicke and Soffa Industries currently has a consensus target price of $31.00, indicating a potential upside of 40.91%. Given Kulicke and Soffa Industries’ higher probable upside, analysts clearly believe Kulicke and Soffa Industries is more favorable than Chipmos Technologies.

Earnings and Valuation

This table compares Kulicke and Soffa Industries and Chipmos Technologies’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Kulicke and Soffa Industries $738.99 million 2.12 $125.75 million $1.20 18.33
Chipmos Technologies N/A N/A N/A $2.52 7.83

Kulicke and Soffa Industries has higher revenue and earnings than Chipmos Technologies. Chipmos Technologies is trading at a lower price-to-earnings ratio than Kulicke and Soffa Industries, indicating that it is currently the more affordable of the two stocks.

Summary

Kulicke and Soffa Industries beats Chipmos Technologies on 9 of the 12 factors compared between the two stocks.

About Kulicke and Soffa Industries

Kulicke and Soffa Industries, Inc. designs, manufactures and sells capital equipment and expendable tools, as well as services, maintains, repairs and upgrades equipment, all used to assemble semiconductor devices. The Company supplies a range of bonding equipment. The Company operates through two segments: Equipment and Expendable Tools. The Equipment segment manufactures and sells a line of ball bonders, wedge bonders, advanced packaging and surface mount technology solutions. The Expendable Tools segment manufactures and sells expendable tools for a range of semiconductor packaging applications. It offers capital equipment and expendable tools used to assemble semiconductor devices, including integrated circuits, high and low powered discrete devices, light-emitting diodes and power modules. Its customers primarily consist of semiconductor device manufacturers, outsourced semiconductor assembly and test providers, other electronics manufacturers and automotive electronics suppliers.

About Chipmos Technologies

ChipMOS TECHNOLOGIES INC is a Taiwan-based company principally engaged in the integrated circuits packaging and testing business. The Company mainly provides thin small outline packaging (TSOP), fine-pitch ball grid array (FBGA) packaging, tape carrier packaging (TCP) and chip on film (COF) packaging services, as well as gold bumping services, among others. The Company’s products and services are used in information products, personal computers, communications equipment, office automation and consumer electronics. It mainly operates its business within domestic market, and in overseas markets, including the rest of Asia and the Americas.

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