Siliconware Precision Industries (SPIL) vs. Silicon Laboratories (SLAB) Critical Analysis

Siliconware Precision Industries (NASDAQ: SPIL) and Silicon Laboratories (NASDAQ:SLAB) are both mid-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, profitability, analyst recommendations, dividends, risk, valuation and institutional ownership.

Dividends

Siliconware Precision Industries pays an annual dividend of $0.21 per share and has a dividend yield of 2.5%. Silicon Laboratories does not pay a dividend. Siliconware Precision Industries pays out 48.8% of its earnings in the form of a dividend.

Risk & Volatility

Siliconware Precision Industries has a beta of 0.36, indicating that its stock price is 64% less volatile than the S&P 500. Comparatively, Silicon Laboratories has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and target prices for Siliconware Precision Industries and Silicon Laboratories, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Siliconware Precision Industries 0 0 0 0 N/A
Silicon Laboratories 0 1 7 0 2.88

Silicon Laboratories has a consensus price target of $103.50, indicating a potential upside of 17.21%. Given Silicon Laboratories’ higher probable upside, analysts plainly believe Silicon Laboratories is more favorable than Siliconware Precision Industries.

Earnings and Valuation

This table compares Siliconware Precision Industries and Silicon Laboratories’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Siliconware Precision Industries $2.75 billion 1.93 $227.38 million $0.43 19.79
Silicon Laboratories $768.87 million 4.90 $47.09 million $1.09 81.01

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

Profitability

This table compares Siliconware Precision Industries and Silicon Laboratories’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Siliconware Precision Industries 8.28% 10.24% 5.60%
Silicon Laboratories 6.12% 11.11% 7.01%

Institutional and Insider Ownership

2.8% of Siliconware Precision Industries shares are held by institutional investors. Comparatively, 90.0% of Silicon Laboratories shares are held by institutional investors. 14.3% of Siliconware Precision Industries shares are held by company insiders. Comparatively, 34.8% of Silicon Laboratories shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Silicon Laboratories beats Siliconware Precision Industries on 11 of the 15 factors compared between the two stocks.

About Siliconware Precision Industries

Siliconware Precision Industries Co., Ltd. is a Taiwan-based company mainly engaged in the provision of packaging and testing services of integrated circuits (ICs) and related products. The Company’s businesses include the manufacture, processing, assembly, testing and importing and exporting of ICs, transistors, light emitting diode (LED) digital displays, LED lights, liquid crystal display (LCD) clock cores, phototransistors, synthesis circuits, as well as thin film circuits and thick film circuits. The Company’s packaging businesses focus on IC products, including plastic small size ICs and plastic square planar ICs, among others. Its testing businesses mainly include final testing businesses and system level testing businesses, among others.

About Silicon Laboratories

Silicon Laboratories Inc. is a provider of silicon, software and solutions for the Internet of Things (IoT), Internet infrastructure, industrial, consumer and automotive markets. The Company operates through mixed-signal analog intensive products segment. It provides analog-intensive, mixed-signal solutions for use in a range of electronic products in various applications for the IoT market. It provides a range of timing and isolation products for infrastructure applications, including clocks and oscillators for networking equipment, data centers and wireless base stations, as well as digital isolators and current sensors for industrial power supplies and hybrid-electric vehicles. It provides broadcast products, such as television tuners and demodulators and automotive radio tuners, and access products, including subscriber line interface circuits for voice over Internet Protocol, embedded modems, and Power over Ethernet power source equipment and powered device integrated circuits.

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