Advanced Micro Devices (NASDAQ: AMD) and United Microelectronics (NYSE:UMC) are both mid-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitability and valuation.

Profitability

This table compares Advanced Micro Devices and United Microelectronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Advanced Micro Devices -1.39% -4.99% -0.65%
United Microelectronics 6.90% 4.84% 2.71%

Risk and Volatility

Advanced Micro Devices has a beta of 2.46, suggesting that its share price is 146% more volatile than the S&P 500. Comparatively, United Microelectronics has a beta of 0.56, suggesting that its share price is 44% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Advanced Micro Devices and United Microelectronics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Advanced Micro Devices 5 13 10 0 2.18
United Microelectronics 8 0 0 0 1.00

Advanced Micro Devices currently has a consensus target price of $14.37, indicating a potential upside of 45.00%. United Microelectronics has a consensus target price of $2.10, indicating a potential downside of 17.97%. Given Advanced Micro Devices’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Advanced Micro Devices is more favorable than United Microelectronics.

Earnings & Valuation

This table compares Advanced Micro Devices and United Microelectronics’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Advanced Micro Devices $4.27 billion 2.24 -$497.00 million ($0.08) -123.88
United Microelectronics $4.59 billion 1.37 $266.08 million $0.13 19.69

United Microelectronics has higher revenue and earnings than Advanced Micro Devices. Advanced Micro Devices is trading at a lower price-to-earnings ratio than United Microelectronics, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

60.0% of Advanced Micro Devices shares are owned by institutional investors. Comparatively, 5.8% of United Microelectronics shares are owned by institutional investors. 1.6% of Advanced Micro Devices shares are owned by company insiders. Comparatively, 8.0% of United Microelectronics shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

United Microelectronics pays an annual dividend of $0.06 per share and has a dividend yield of 2.3%. Advanced Micro Devices does not pay a dividend. United Microelectronics pays out 46.2% of its earnings in the form of a dividend.

Summary

United Microelectronics beats Advanced Micro Devices on 8 of the 15 factors compared between the two stocks.

About Advanced Micro Devices

Advanced Micro Devices, Inc. is a global semiconductor company. The Company is engaged in offering x86 microprocessors, as standalone devices or as incorporated into an accelerated processing unit (APU), chipsets, discrete graphics processing units (GPUs) and professional graphics, and server and embedded processors and semi-custom System-on-Chip (SoC) products and technology for game consoles. The Company’s segments include the Computing and Graphics segment, and the Enterprise, Embedded and Semi-Custom segment. The Computing and Graphics segment primarily includes desktop and notebook processors and chipsets, discrete GPUs and professional graphics. The Enterprise, Embedded and Semi-Custom segment primarily includes server and embedded processors, semi-custom SoC products, development services, technology for game consoles and licensing portions of its intellectual property portfolio.

About United Microelectronics

United Microelectronics Corporation is a global semiconductor foundry. The Company provides integrated circuit (IC) production for applications spanning every sector of the electronics industry. The Company operates through two segments: wafer fabrication and new business. The primary operating activity of the Company’s wafer fabrication segment is the manufacture of chips to the design specifications of its customers by using its own processes and techniques. The new business segment primarily includes researching, developing, manufacturing, and providing solar energy and new generation light-emitting diode (LED). The Company maintains a customer base across various industries, including communication, consumer electronics, computer, memory and others, while focusing on manufacturing for applications, including networking, telecommunications, Internet, multimedia, personal computers (PCs) and graphics.

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