Chipmos Technologies (IMOS) and Fortive (FTV) Critical Analysis

Chipmos Technologies (NASDAQ: IMOS) and Fortive (NYSE:FTV) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Dividends

Chipmos Technologies pays an annual dividend of $0.46 per share and has a dividend yield of 2.5%. Fortive pays an annual dividend of $0.28 per share and has a dividend yield of 0.4%. Chipmos Technologies pays out 17.4% of its earnings in the form of a dividend. Fortive pays out 10.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Valuation and Earnings

This table compares Chipmos Technologies and Fortive’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Chipmos Technologies $567.50 million 1.40 $43.24 million $2.64 7.00
Fortive $6.22 billion 4.16 $872.30 million $2.65 28.14

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

Institutional & Insider Ownership

16.5% of Chipmos Technologies shares are held by institutional investors. Comparatively, 78.9% of Fortive shares are held by institutional investors. 12.1% of Fortive shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Chipmos Technologies and Fortive’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chipmos Technologies 19.18% 9.42% 4.96%
Fortive 14.39% 31.67% 11.32%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Chipmos Technologies and Fortive, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chipmos Technologies 0 0 0 0 N/A
Fortive 0 7 7 0 2.50

Fortive has a consensus target price of $69.50, indicating a potential downside of 6.81%. Given Fortive’s higher possible upside, analysts clearly believe Fortive is more favorable than Chipmos Technologies.

Summary

Fortive beats Chipmos Technologies on 12 of the 14 factors compared between the two stocks.

Chipmos Technologies Company Profile

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.

Fortive Company Profile

Fortive Corporation is a diversified industrial growth company. The Company designs, develops, manufactures and markets professional and engineered products, software and services for a range of end markets. The Company operates through two segments: Professional Instrumentation and Industrial Technologies. The Company’s brands operate in field instrumentation, transportation, sensing, product realization, automation and specialty, and franchise distribution markets. The Professional Instrumentation segment offers essential products, software and services used to create actionable intelligence by measuring and monitoring a range of physical parameters in industrial applications, including electrical current, radio frequency signals, distance, pressure and temperature. The Industrial Technologies segment offers critical technical equipment, components, software and services for manufacturing, repair and transportation markets around the world.

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