ASML (NASDAQ: ASML) and Kulicke and Soffa Industries (NASDAQ:KLIC) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, profitability, dividends, valuation, analyst recommendations and institutional ownership.

Risk and Volatility

ASML has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, Kulicke and Soffa Industries has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500.

Profitability

This table compares ASML and Kulicke and Soffa Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ASML 23.81% 19.82% 11.51%
Kulicke and Soffa Industries 16.85% 15.13% 11.68%

Institutional & Insider Ownership

16.6% of ASML shares are owned by institutional investors. Comparatively, 85.8% of Kulicke and Soffa Industries shares are owned by institutional investors. 1.0% of Kulicke and Soffa Industries shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares ASML and Kulicke and Soffa Industries’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ASML $7.52 billion 9.76 $1.63 billion $5.05 33.80
Kulicke and Soffa Industries $809.00 million 2.09 $112.01 million $1.56 15.38

ASML has higher revenue and earnings than Kulicke and Soffa Industries. Kulicke and Soffa Industries is trading at a lower price-to-earnings ratio than ASML, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations for ASML and Kulicke and Soffa Industries, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ASML 0 5 11 0 2.69
Kulicke and Soffa Industries 1 0 2 0 2.33

ASML presently has a consensus price target of $176.17, suggesting a potential upside of 3.22%. Kulicke and Soffa Industries has a consensus price target of $29.17, suggesting a potential upside of 21.58%. Given Kulicke and Soffa Industries’ higher probable upside, analysts clearly believe Kulicke and Soffa Industries is more favorable than ASML.

Dividends

ASML pays an annual dividend of $1.11 per share and has a dividend yield of 0.7%. Kulicke and Soffa Industries does not pay a dividend. ASML pays out 22.0% of its earnings in the form of a dividend.

Summary

ASML beats Kulicke and Soffa Industries on 10 of the 16 factors compared between the two stocks.

ASML Company Profile

ASML Holding N.V. is a holding company. The Company is a manufacturer of chip-making equipment. The Company is engaged in the development, production, marketing, selling and servicing of semiconductor equipment systems, consisting of lithography systems. The Company’s products include systems, and installed base products and services. The Company’s principal operations are in the Netherlands, the United States and Asia. The Company offers TWINSCAN systems, equipped with lithography system with a mercury lamp as light source (i-line), Krypton Fluoride (KrF) and Argon Fluoride (ArF) light sources for 300 millimeter processing wafers for manufacturing environments for which imaging at a small resolution is required. TWINSCAN systems also include immersion lithography systems (TWINSCAN immersion systems). The Company also offers NXE systems, which are equipped with extreme ultraviolet (EUV) light source technology. The Company offers YieldStar, a wafer metrology system.

Kulicke and Soffa Industries Company Profile

Kulicke and Soffa Industries, Inc. designs, manufactures and sells capital equipment and expendable tools, as well as services, maintains, repairs and upgrades equipment, all used to assemble semiconductor devices. The Company supplies a range of bonding equipment. The Company operates through two segments: Equipment and Expendable Tools. The Equipment segment manufactures and sells a line of ball bonders, wedge bonders, advanced packaging and surface mount technology solutions. The Expendable Tools segment manufactures and sells expendable tools for a range of semiconductor packaging applications. It offers capital equipment and expendable tools used to assemble semiconductor devices, including integrated circuits, high and low powered discrete devices, light-emitting diodes and power modules. Its customers primarily consist of semiconductor device manufacturers, outsourced semiconductor assembly and test providers, other electronics manufacturers and automotive electronics suppliers.

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