Microchip Technology (NASDAQ:MCHP) and EMCORE (NASDAQ:EMKR) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.
This table compares Microchip Technology and EMCORE’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk & Volatility
Microchip Technology has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, EMCORE has a beta of 0.24, meaning that its share price is 76% less volatile than the S&P 500.
This is a summary of recent ratings and target prices for Microchip Technology and EMCORE, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Microchip Technology presently has a consensus target price of $112.56, suggesting a potential upside of 64.89%. EMCORE has a consensus target price of $5.67, suggesting a potential upside of 9.40%. Given Microchip Technology’s higher probable upside, equities research analysts clearly believe Microchip Technology is more favorable than EMCORE.
Insider and Institutional Ownership
70.6% of EMCORE shares are held by institutional investors. 2.1% of Microchip Technology shares are held by insiders. Comparatively, 2.0% of EMCORE shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Microchip Technology pays an annual dividend of $1.46 per share and has a dividend yield of 2.1%. EMCORE does not pay a dividend. Microchip Technology pays out 28.1% of its earnings in the form of a dividend. Microchip Technology has raised its dividend for 16 consecutive years.
Earnings and Valuation
This table compares Microchip Technology and EMCORE’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Microchip Technology||$3.98 billion||4.04||$255.40 million||$5.19||13.15|
|EMCORE||$122.89 million||1.16||$8.23 million||$0.39||13.28|
Microchip Technology has higher revenue and earnings than EMCORE. Microchip Technology is trading at a lower price-to-earnings ratio than EMCORE, indicating that it is currently the more affordable of the two stocks.
Microchip Technology beats EMCORE on 14 of the 18 factors compared between the two stocks.
About Microchip Technology
Microchip Technology Incorporated develops, manufactures, and sells semiconductor products for various embedded control applications. The company offers general purpose and specialized 8-bit, 16-bit, and 32-bit microcontrollers; 32-bit microprocessors; and microcontrollers for automotive networking, computing, lighting, power supplies, motor control, human machine interface, security, wired connectivity, and wireless connectivity. It also provides development tools that enable system designers to program microcontroller products for specific applications; analog, interface, mixed signal, and timing products comprising power management, linear, mixed-signal, high-voltage, thermal management, radio frequency (RF), drivers, safety, security, timing, USB, Ethernet, wireless, and other interface products; and memory products consisting of serial electrically erasable programmable read-only memory, serial flash memories, parallel flash memories, and serial static random access memories for the production of very small footprint devices. In addition, the company licenses its SuperFlash embedded flash and Smartbits one time programmable NVM technologies to foundries, integrated device manufacturers, and design partners for use in the manufacture of microcontroller products, gate array, RF, and analog products that require embedded non-volatile memory, as well as provides engineering services. Further, it provides wafer foundry and assembly and test subcontracting manufacturing services; and application specific integrated circuits, complex programmable logic devices, and aerospace products. It serves automotive, communications, computing, consumer, aerospace, defense, safety, security, medical, and industrial control markets. The company sells its products through a network of direct sales personnel and distributors in the Americas, Europe, and Asia. Microchip Technology Incorporated was founded in 1989 and is headquartered in Chandler, Arizona.
EMCORE Corporation, together with its subsidiaries, provides advanced mixed-signal optics products in California. It offers broadband products comprising cable television; laser, receiver, and photodetector component products; radio frequency over glass FTTP products; satellite/microwave communications products; and wireless communications products. The company also provides chip devices products, including high-power gain chips, GPON fiber-to-the-premises, and data center chip products; and navigation systems products, such as fiber optic gyroscope products and inertial measurement units and navigation systems products. It sells its products through direct sales force, application engineers, third party sales representatives, and distributors. EMCORE Corporation was founded in 1984 and is headquartered in Alhambra, California.
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