Critical Review: Applied Micro Circuits (AMCC) and Its Peers

Applied Micro Circuits (NASDAQ: AMCC) is one of 104 publicly-traded companies in the “Semiconductors” industry, but how does it contrast to its competitors? We will compare Applied Micro Circuits to related companies based on the strength of its analyst recommendations, valuation, risk, profitability, dividends, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Applied Micro Circuits and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Applied Micro Circuits 0 4 0 0 2.00
Applied Micro Circuits Competitors 916 4771 8662 359 2.58

Applied Micro Circuits presently has a consensus price target of $8.00, indicating a potential downside of 5.33%. As a group, “Semiconductors” companies have a potential upside of 8.23%. Given Applied Micro Circuits’ competitors stronger consensus rating and higher possible upside, analysts clearly believe Applied Micro Circuits has less favorable growth aspects than its competitors.

Volatility & Risk

Applied Micro Circuits has a beta of 1.81, suggesting that its stock price is 81% more volatile than the S&P 500. Comparatively, Applied Micro Circuits’ competitors have a beta of 1.07, suggesting that their average stock price is 7% more volatile than the S&P 500.

Profitability

This table compares Applied Micro Circuits and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Applied Micro Circuits -11.11% -16.63% -13.04%
Applied Micro Circuits Competitors -45.97% 1.68% 0.89%

Insider & Institutional Ownership

73.3% of Applied Micro Circuits shares are owned by institutional investors. Comparatively, 66.4% of shares of all “Semiconductors” companies are owned by institutional investors. 12.4% of Applied Micro Circuits shares are owned by insiders. Comparatively, 6.2% of shares of all “Semiconductors” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Applied Micro Circuits and its competitors revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Applied Micro Circuits N/A N/A -22.24
Applied Micro Circuits Competitors $4.23 billion $1.33 billion 24.19

Applied Micro Circuits’ competitors have higher revenue and earnings than Applied Micro Circuits. Applied Micro Circuits is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Summary

Applied Micro Circuits competitors beat Applied Micro Circuits on 7 of the 11 factors compared.

About Applied Micro Circuits

Applied Micro Circuits Corporation (AMCC) provides silicon solutions for cloud infrastructure and data centers, as well as connectivity products for edge, metro and long haul communications equipment. The Company’s products serve Computing and Connectivity markets. Its Computing products include the X-Gene family of server processors, based on the ARMv8 64-bit Instruction Set Architecture (ISA), which target mainstream cloud and data center infrastructure, including hyperscale, telco, enterprise and high performance computing. It also offers embedded computing products, which include HeliX family of processors, based on the ARM 64-bit ISA and its PowerPC products, based on Power Architecture. Its embedded Computing products are deployed in various applications, including networking and telecom, enterprise storage and industrial applications. The Connectivity business includes X-Weave family of products for service providers and public cloud, private cloud and enterprise data centers.

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