Head to Head Analysis: Silicon Motion Technology (SIMO) & POET Technologies (POETF)

Silicon Motion Technology (NASDAQ:SIMO) and POET Technologies (OTCMKTS:POETF) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Silicon Motion Technology and POET Technologies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Silicon Motion Technology 1 3 9 0 2.62
POET Technologies 0 0 1 0 3.00

Silicon Motion Technology presently has a consensus target price of $58.52, suggesting a potential upside of 29.27%. POET Technologies has a consensus target price of $2.00, suggesting a potential upside of 661.90%. Given POET Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe POET Technologies is more favorable than Silicon Motion Technology.

Valuation and Earnings

This table compares Silicon Motion Technology and POET Technologies’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Silicon Motion Technology $523.40 million 3.12 $74.95 million $2.09 21.66
POET Technologies $2.79 million 27.10 -$12.79 million ($0.05) -5.25

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

Profitability

This table compares Silicon Motion Technology and POET Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Silicon Motion Technology 15.28% 15.97% 12.31%
POET Technologies -498.36% -53.26% -48.62%

Risk & Volatility

Silicon Motion Technology has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, POET Technologies has a beta of -1.7, meaning that its stock price is 270% less volatile than the S&P 500.

Insider & Institutional Ownership

75.1% of Silicon Motion Technology shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Silicon Motion Technology pays an annual dividend of $1.19 per share and has a dividend yield of 2.6%. POET Technologies does not pay a dividend. Silicon Motion Technology pays out 56.9% of its earnings in the form of a dividend. Silicon Motion Technology has increased its dividend for 2 consecutive years.

Summary

Silicon Motion Technology beats POET Technologies on 12 of the 16 factors compared between the two stocks.

Silicon Motion Technology Company Profile

Silicon Motion Technology Corporation, together with its subsidiaries, designs, develops, and markets semiconductor solutions for the mobile and enterprise storage, and mobile communications markets worldwide. It offers embedded storage and expandable storage products, including NAND flash controllers, such as embedded multimediacard (eMMC), universal flash storage, client solid-state drive (SSD), secure digital card, flash memory card controller, and universal serial bus flash drive controller products. The company also provides specialty storage solutions, such as customized enterprise-grade peripheral component interconnect express SSDs; and industrial-grade and commercial-grade single-chip SSDs. In addition, it offers specialty radio frequency integrated circuits (RF ICs), such as mobile TV system-on-chips (SoCs) and low power WiFi SoCs. The company's products are used in smartphones, tablets, digital cameras, camcorders, and desktop and notebook PCs, as well as in industrial, enterprise, commercial, and other applications. It offers its controllers under the SMI brand; enterprise-grade SSDs under the Shannon brand; single-chip industrial-grade SSDs under the Ferri SSD and Ferri-eMMC brands; RF ICs under the FCI brand; and software-defined storage products under the Bigtera brand. The company markets and sells its products through direct sales personnel and independent electronics distributors to flash manufacturers, original equipment manufacturers, and module makers. Silicon Motion Technology Corporation was founded in 1995 and is based in Kowloon, Hong Kong.

POET Technologies Company Profile

POET Technologies Inc. designs, manufactures, and sells semi-conductor products in the United States, Canada, and Singapore. It offers optical light source products and photonic integrated devices for the sensing, data and tele communications, medical, instrumentation, industrial, defense, and security markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. is headquartered in Toronto, Canada.

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