Head-To-Head Comparison: Rohm (OTCMKTS:ROHCY) and FormFactor (NASDAQ:FORM)

Rohm (OTCMKTS:ROHCY) and FormFactor (NASDAQ:FORM) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, risk, dividends and institutional ownership.

Insider and Institutional Ownership

98.8% of FormFactor shares are held by institutional investors. 0.8% of FormFactor shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Rohm and FormFactor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rohm	-31.42%	3.39%	2.13%
FormFactor	8.14%	9.31%	7.83%

Risk & Volatility

Rohm has a beta of 1.3, indicating that its share price is 30% more volatile than the S&P 500. Comparatively, FormFactor has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Rohm and FormFactor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rohm	0	1	0	0	2.00
FormFactor	0	5	5	1	2.64

FormFactor has a consensus price target of $132.45, suggesting a potential upside of 13.50%. Given FormFactor’s stronger consensus rating and higher possible upside, analysts clearly believe FormFactor is more favorable than Rohm.

Earnings and Valuation

This table compares Rohm and FormFactor”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rohm	$3.20 billion	3.83	-$1.05 billion	($2.64)	-12.01
FormFactor	$784.99 million	11.59	$54.36 million	$0.87	134.14

FormFactor has lower revenue, but higher earnings than Rohm. Rohm is trading at a lower price-to-earnings ratio than FormFactor, indicating that it is currently the more affordable of the two stocks.

Summary

FormFactor beats Rohm on 13 of the 15 factors compared between the two stocks.

About Rohm

ROHM Co., Ltd. manufactures and sells electronic components worldwide. The company operates through three segments: LSI, Semiconductor Devices, and Modules. It provides ICs comprising memory, amplifiers and linear, power management, motor/actuator drivers, resistors, clocks and timers, switches and multiplexers, logic, data converters, sensors and MEMS, display drivers, interfaces, wireless LSIs, audio and video products, speech synthesis LSI, and microcontrollers. The company also offers discrete semiconductor products, such as MOSFETs, bipolar transistors, and diodes; power devices, including power transistors and diodes, SiC power devices, IGBT, and IPM; modules, including optical modules, wireless communication modules, wireless charger modules, and print heads; and opto devices comprising LEDs, LED displays, laser diodes, and optical sensors, as well as foundry services, including thin-film piezoelectric MEMS, wafers, and WL-CSP. Its products are used in industry, automotive, consumer electronics, and telecommunications applications. The company was incorporated in 1940 and is headquartered in Kyoto, Japan.

About FormFactor

FormFactor, Inc. designs, manufactures, and sells probe cards, analytical probes, probe stations, metrology systems, thermal systems, and cryogenic systems to semiconductor companies and scientific institutions in the United States, Taiwan, South Korea, China, Europe, Japan, Malaysia, Singapore, and internationally. It operates in two segments, Probe Cards and Systems. The company offers probe cards to test various semiconductor device types, including systems on a chip products, mobile application processors, microprocessors, microcontrollers, and graphic processors, as well as radio frequency, analog, mixed signal, image sensor, electro-optical, dynamic random access memory, NAND flash memory, and NOR flash memory devices, as well as computer processor devices; and analytical probes, which are used for a range of applications, including device characterization, electrical simulation model development, failure analysis, and prototype design debugging for universities, research institutions, semiconductor integrated device manufacturers, semiconductor foundries, and fabless semiconductor companies. It also provides probe systems for semiconductor design engineers to capture and analyze accurate data; surface metrology systems for the development, production, and quality control of semiconductor products; thermal subsystems, such as thermal chucks and other test systems used in probe stations and other applications; and precision cryogenic instruments, semiconductor tests, and measurement systems. In addition, the company offers on-site probe card maintenance and service training, seminars, and telephone support services. It markets and sells its products through direct sales force, manufacturers' representatives, and distributors. The company was incorporated in 1993 and is headquartered in Livermore, California.