Coherent (NASDAQ: COHR) and Silicon Motion Technology Corporation (NASDAQ:SIMO) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, dividends, analyst recommendations, valuation and risk.
Silicon Motion Technology Corporation pays an annual dividend of $0.79 per share and has a dividend yield of 1.6%. Coherent does not pay a dividend. Silicon Motion Technology Corporation pays out 31.1% of its earnings in the form of a dividend.
Valuation & Earnings
This table compares Coherent and Silicon Motion Technology Corporation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Coherent||$1.48 billion||4.37||$403.41 million||$6.63||39.62|
|Silicon Motion Technology Corporation||$562.80 million||3.07||$145.81 million||$2.54||19.06|
Coherent has higher revenue and earnings than Silicon Motion Technology Corporation. Silicon Motion Technology Corporation is trading at a lower price-to-earnings ratio than Coherent, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Coherent has a beta of 0.78, indicating that its share price is 22% less volatile than the S&P 500. Comparatively, Silicon Motion Technology Corporation has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.
This is a summary of current recommendations and price targets for Coherent and Silicon Motion Technology Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Silicon Motion Technology Corporation||0||3||10||0||2.77|
Coherent currently has a consensus target price of $296.13, indicating a potential upside of 12.72%. Silicon Motion Technology Corporation has a consensus target price of $57.67, indicating a potential upside of 19.10%. Given Silicon Motion Technology Corporation’s higher possible upside, analysts clearly believe Silicon Motion Technology Corporation is more favorable than Coherent.
This table compares Coherent and Silicon Motion Technology Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Silicon Motion Technology Corporation||17.18%||20.07%||15.08%|
Insider and Institutional Ownership
90.3% of Coherent shares are held by institutional investors. Comparatively, 79.4% of Silicon Motion Technology Corporation shares are held by institutional investors. 1.4% of Coherent shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Coherent beats Silicon Motion Technology Corporation on 11 of the 16 factors compared between the two stocks.
Coherent Company Profile
Coherent, Inc. is a photonics manufacturer. The Company is engaged in designing, manufacturing, servicing and marketing of lasers and related accessories for a range of scientific, commercial and industrial applications. It operates through two segments: Specialty Lasers and Systems (SLS) and Commercial Lasers and Components (CLC). SLS develops and manufactures configurable products serving the microelectronics, scientific research and government programs, and original equipment manufacturer (OEM) components and instrumentation markets. The Commercial Lasers and Components segment focuses on higher volume products that are offered in set configurations. The product architectures are designed for exchange at the point of use such that substantially all product service and repairs are based upon advanced replacement and depot (that is factory) repair. CLC’s primary markets include materials processing, OEM components, and instrumentation and microelectronics.
Silicon Motion Technology Corporation Company Profile
Silicon Motion Technology Corporation is a fabless semiconductor company. The Company designs, develops and markets low-power semiconductor solutions to original equipment manufacturers (OEMs) and other customers in the mobile storage and mobile communications markets. It is engaged in developing negative-AND (NAND) flash controller integrated circuits (ICs) for solid-state storage devices and specialty radio frequency (RF) ICs for mobile devices. In the mobile storage market, the Company’s products are controllers used in embedded storage products, such as Solid State Drives (SSDs), and Embedded Multimedia Cards (eMMCs), as well as expandable storage products, such as flash memory cards and universal serial bus (USB) flash drives. For the mobile communications market, the Company’s products are handset transceivers and mobile television (TV) System on Chips (SoCs). The Company’s products are used in devices, such as smartphones, tablets and personal computers (PCs).
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