Financial Review: United Microelectronics (NYSE:UMC) & POET Technologies (NASDAQ:POET)

United Microelectronics (NYSE:UMC) and POET Technologies (NASDAQ:POET) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.

Institutional and Insider Ownership

5.1% of United Microelectronics shares are owned by institutional investors. Comparatively, 2.0% of POET Technologies shares are owned by institutional investors. 8.0% of United Microelectronics shares are owned by company insiders. Comparatively, 0.5% of POET Technologies shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares United Microelectronics and POET Technologies’ top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Microelectronics	$7.25 billion	2.69	$1.96 billion	$0.70	11.13
POET Technologies	$470,000.00	256.60	-$20.27 million	($0.51)	-4.90

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

Volatility and Risk

United Microelectronics has a beta of 1.21, meaning that its share price is 21% more volatile than the S&P 500. Comparatively, POET Technologies has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500.

Profitability

This table compares United Microelectronics and POET Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Microelectronics	24.79%	15.82%	9.88%
POET Technologies	N/A	-207.55%	-160.39%

Analyst Recommendations

This is a summary of recent recommendations for United Microelectronics and POET Technologies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Microelectronics	0	2	1	0	2.33
POET Technologies	0	0	1	0	3.00

United Microelectronics currently has a consensus price target of $8.90, indicating a potential upside of 14.25%. POET Technologies has a consensus price target of $7.50, indicating a potential upside of 200.00%. Given POET Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe POET Technologies is more favorable than United Microelectronics.

Summary

United Microelectronics beats POET Technologies on 10 of the 13 factors compared between the two stocks.

About United Microelectronics

United Microelectronics Corporation operates as a semiconductor wafer foundry in Taiwan, Singapore, China, Hong Kong, Japan, the United States, Europe, and internationally. The company provides circuit design, mask tooling, wafer fabrication, and assembly and testing services. It serves fabless design companies and integrated device manufacturers. The company was incorporated in 1980 and is headquartered in Hsinchu City, Taiwan.

About POET Technologies

POET Technologies Inc. designs, develops, manufactures, and sells discrete and integrated opto-electronic solutions in Canada, the United States, Singapore, and China. It offers integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques. It also develops photonic integrated components. The company serves the data center, telecommunications, Internet of things and industrial sensing, automotive LIDAR, optical coherence tomography for medical devices, and virtual reality systems markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. was incorporated in 1972 and is headquartered in Toronto, Canada.