Alpha and Omega Semiconductor Limited (NASDAQ: AOSL) and Entropic Communications (NASDAQ:ENTR) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Profitability

This table compares Alpha and Omega Semiconductor Limited and Entropic Communications’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alpha and Omega Semiconductor Limited 3.61% 4.76% 3.71%
Entropic Communications -10.45% -11.67% -9.68%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Alpha and Omega Semiconductor Limited and Entropic Communications, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alpha and Omega Semiconductor Limited 0 1 3 0 2.75
Entropic Communications 0 0 0 0 N/A

Alpha and Omega Semiconductor Limited currently has a consensus target price of $26.00, indicating a potential upside of 49.25%. Given Alpha and Omega Semiconductor Limited’s higher probable upside, research analysts plainly believe Alpha and Omega Semiconductor Limited is more favorable than Entropic Communications.

Institutional & Insider Ownership

69.9% of Alpha and Omega Semiconductor Limited shares are held by institutional investors. 21.7% of Alpha and Omega Semiconductor Limited shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Alpha and Omega Semiconductor Limited and Entropic Communications’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Alpha and Omega Semiconductor Limited $383.34 million 1.09 $39.73 million $0.56 31.11
Entropic Communications N/A N/A N/A N/A N/A

Alpha and Omega Semiconductor Limited has higher revenue and earnings than Entropic Communications.

Summary

Alpha and Omega Semiconductor Limited beats Entropic Communications on 8 of the 8 factors compared between the two stocks.

About Alpha and Omega Semiconductor Limited

Alpha and Omega Semiconductor Limited is a designer, developer and global supplier of power semiconductors. The Company’s portfolio of power semiconductors includes approximately 1,600 products, as of June 30, 2016. The Company’s product portfolio consists of two categories: power discretes and power integrated circuits (ICs). The Company’s portfolio of products focuses high-volume applications, including personal computers, flat panel televisions, light-emitting diode (LED) lighting, smart phones, battery packs, consumer and industrial motor controls and power supplies for television, computers, servers and telecommunications equipment. The Company sells its products primarily to distributors in the Asia Pacific region, who in turn sell these products to end customers. The Company conducts its operations primarily in the United States, Hong Kong, China, Taiwan, Korea and Japan. Its products are applicable in desktop and tablet personal computers, flat panel displays and televisions.

About Entropic Communications

Entropic Communications, Inc. (Entropic) is a fabless semiconductor company. Entropic designs, develops and markets semiconductor solutions to enable home entertainment. The Company offers a portfolio of set-top box (STB), Video System-on-a-Chip (SoC) and home connectivity (Connectivity) solutions. Entropic’s Connectivity solutions enable access to broadcast and Internet Protocol television (IPTV) services, as well as deliver and distribute other media content, such as movies, music, games and photos across the home. The Company’s Connectivity solutions include home networking solutions based on the Multimedia over Coax Alliance (MoCA) standard, high-speed broadband access solutions and Direct Broadcast Satellite outdoor unit (DBS ODU) solutions. Entropic’s STB product portfolio consists of a range of digital STB components and system solutions for the satellite, terrestrial, cable and IPTV markets across the world.

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