Microsemi Corporation (NASDAQ: MSCC) and NXP Semiconductors N.V. (NASDAQ:NXPI) are both mid-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Microsemi Corporation and NXP Semiconductors N.V., as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Microsemi Corporation 0 2 12 0 2.86
NXP Semiconductors N.V. 0 16 0 1 2.12

Microsemi Corporation presently has a consensus target price of $58.36, indicating a potential upside of 13.42%. NXP Semiconductors N.V. has a consensus target price of $110.19, indicating a potential downside of 4.54%. Given Microsemi Corporation’s stronger consensus rating and higher probable upside, research analysts clearly believe Microsemi Corporation is more favorable than NXP Semiconductors N.V..

Volatility and Risk

Microsemi Corporation has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500. Comparatively, NXP Semiconductors N.V. has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500.

Earnings and Valuation

This table compares Microsemi Corporation and NXP Semiconductors N.V.’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Microsemi Corporation $1.79 billion 3.33 $550.50 million $1.06 48.55
NXP Semiconductors N.V. $9.32 billion 4.29 $2.70 billion $4.56 25.31

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

Insider and Institutional Ownership

98.3% of Microsemi Corporation shares are held by institutional investors. Comparatively, 78.9% of NXP Semiconductors N.V. shares are held by institutional investors. 0.6% of Microsemi Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Microsemi Corporation and NXP Semiconductors N.V.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Microsemi Corporation 6.90% 19.91% 8.20%
NXP Semiconductors N.V. 16.87% 16.15% 7.85%

Summary

Microsemi Corporation beats NXP Semiconductors N.V. on 8 of the 15 factors compared between the two stocks.

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.

About NXP Semiconductors N.V.

NXP Semiconductors N.V. (NXP) is a holding company. The Company operates as a semiconductor company. The Company provides high performance mixed signal and standard product solutions. The Company’s segments are High Performance Mixed Signal (HPMS), Standard Products (SP), and Corporate and Other. Its product solutions are used in a range of end-market applications, including automotive, personal security and identification, wireless and wireline infrastructure, mobile communications, multi-market industrial, consumer and computing. It engages with global original equipment manufacturers (OEMs) and sells products in all geographic regions. NXP’s HPMS segment includes business lines, such as Automotive, Secure Identification Solutions (SIS), Secure Connected Devices (SCD), and Secure Interfaces and Infrastructure (SI&I). The Company’s SP segment supplies a range of standard semiconductor components, such as small signal discretes and power discretes.

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