Advanced Semiconductor Engineering (NYSE: ASX) and Semiconductor Manufacturing International Corporation (NYSE:SMI) are both mid-cap computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Risk and Volatility

Advanced Semiconductor Engineering has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500. Comparatively, Semiconductor Manufacturing International Corporation has a beta of 0.29, indicating that its share price is 71% less volatile than the S&P 500.

Profitability

This table compares Advanced Semiconductor Engineering and Semiconductor Manufacturing International Corporation’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%
Semiconductor Manufacturing International Corporation 10.33% 5.63% 3.10%

Dividends

Advanced Semiconductor Engineering pays an annual dividend of $0.16 per share and has a dividend yield of 2.5%. Semiconductor Manufacturing International Corporation does not pay a dividend. Advanced Semiconductor Engineering pays out 36.4% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Advanced Semiconductor Engineering and Semiconductor Manufacturing International Corporation’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 1.08 $1.84 billion $0.44 14.30
Semiconductor Manufacturing International Corporation $3.13 billion 2.28 $1.14 billion $0.34 19.12

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

Institutional and Insider Ownership

5.9% of Advanced Semiconductor Engineering shares are owned by institutional investors. Comparatively, 0.7% of Semiconductor Manufacturing International Corporation shares are owned by institutional investors. 22.9% of Advanced Semiconductor Engineering shares are owned by 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.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Advanced Semiconductor Engineering and Semiconductor Manufacturing International Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Advanced Semiconductor Engineering 0 1 0 0 2.00
Semiconductor Manufacturing International Corporation 4 2 2 0 1.75

Semiconductor Manufacturing International Corporation has a consensus price target of $8.68, suggesting a potential upside of 33.54%. Given Semiconductor Manufacturing International Corporation’s higher probable upside, analysts clearly believe Semiconductor Manufacturing International Corporation is more favorable than Advanced Semiconductor Engineering.

Summary

Advanced Semiconductor Engineering beats Semiconductor Manufacturing International Corporation on 10 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 Semiconductor Manufacturing International Corporation

Semiconductor Manufacturing International Corporation is an investment holding company principally engaged in the computer-aided design, manufacture, packaging and trading of integrated circuits (IC), as well as the provision of other semiconductor services. The Company is also involved in the design and manufacture of semiconductor masks. The Company’s main products are various types of wafers. The Company distributes its products in domestic market and to overseas markets, such as the Europe and the United States.

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