Financial Comparison: Digital China (OTCMKTS:DCHIF) vs. Silicon Motion Technology (NASDAQ:SIMO)

Digital China (OTCMKTS:DCHIF) and Silicon Motion Technology (NASDAQ:SIMO) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, profitability, valuation, earnings and analyst recommendations.

Profitability

This table compares Digital China and Silicon Motion Technology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Digital China	N/A	N/A	N/A
Silicon Motion Technology	12.06%	12.00%	9.18%

Institutional and Insider Ownership

78.0% of Silicon Motion Technology shares are held by institutional investors. 5.3% of Silicon Motion Technology shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings for Digital China and Silicon Motion Technology, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Digital China	0	0	0	0	0.00
Silicon Motion Technology	0	0	10	0	3.00

Silicon Motion Technology has a consensus target price of $83.89, indicating a potential upside of 10.72%. Given Silicon Motion Technology’s stronger consensus rating and higher possible upside, analysts plainly believe Silicon Motion Technology is more favorable than Digital China.

Earnings and Valuation

This table compares Digital China and Silicon Motion Technology”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Digital China	$2.32 billion	0.28	-$35.32 million	N/A	N/A
Silicon Motion Technology	$803.55 million	3.20	$89.25 million	$2.79	27.16

Silicon Motion Technology has lower revenue, but higher earnings than Digital China.

Volatility & Risk

Digital China has a beta of -0.09, indicating that its share price is 109% less volatile than the S&P 500. Comparatively, Silicon Motion Technology has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500.

Summary

Silicon Motion Technology beats Digital China on 11 of the 12 factors compared between the two stocks.

About Digital China

Digital China Holdings Limited, an investment holding company, provides big data products and solutions for government and enterprise customers primarily in Mainland China. The Big Data Products and Solutions segment sells data software products focused on spatial-temporal big data and artificial intelligence. This segment offers data fabric comprising Yan Cloud DaaS, a software platform that supports data sharing, interoperability, and integration of isolated digital islands; and Sysnet, an integration platform that integrates various data, applications, and services. It also provides data hub, including data management, security, innovation, and aggregation products; and digital twin, which constructs a digital replica of the physical city, as well as data solutions for city and supply chain digital native transformation, and fintech. The Software and Operating Services segment offers end-to-end data-enabled supply chain operating services, as well as software development, testing, operation, and maintenance services. The Traditional and Localization Services segment provides systems integration services, e-commerce supply chain services, and software and operating services. The segment also engages in the investments, property sales and rental, and other businesses. The company also engages in the provision of logistics, systems integration, and manpower services, as well as engages in finance lease business and investment holding activities. Digital China Holdings Limited was incorporated in 2000 and is headquartered in Wan Chai, Hong Kong.

About Silicon Motion Technology

Silicon Motion Technology Corporation, together with its subsidiaries, designs, develops, and markets NAND flash controllers for solid-state storage devices. The company offers controllers for computing-grade solid state drives (SSDs), which are used in PCs and other client devices; enterprise-grade SSDs used in data centers; eMMC and UFS mobile embedded storage for use in smartphones and IoT devices; flash memory cards and flash drives for use in expandable storage; and specialized SSDs that are used in industrial, commercial, and automotive applications. It markets its controllers under the SMI brand; enterprise-grade SSDs under the Shannon Systems brand; and single-chip industrial-grade SSDs under the FerriSSD, Ferri-eMMC, and Ferri-UFS brands. The company markets and sells its products through direct sales personnel and independent electronics distributors to NAND flash makers, module makers, hyperscalers, and OEMs. It operates in Taiwan, the United States, Korea, China, Malaysia, Singapore, and internationally. The company was founded in 1995 and is based in Hong Kong, Hong Kong.