Photronics (NASDAQ: PLAB) and FormFactor (NASDAQ:FORM) are both small-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, dividends, risk and profitability.
Volatility & Risk
Photronics has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, FormFactor has a beta of 1.47, suggesting that its stock price is 47% more volatile than the S&P 500.
94.6% of Photronics shares are held by institutional investors. Comparatively, 84.3% of FormFactor shares are held by institutional investors. 3.7% of Photronics shares are held by company insiders. Comparatively, 2.3% of FormFactor shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Photronics and FormFactor’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Photronics||$450.68 million||1.45||$46.20 million||$0.20||47.50|
|FormFactor||$383.88 million||2.97||-$6.55 million||$0.26||60.00|
Photronics has higher revenue and earnings than FormFactor. Photronics is trading at a lower price-to-earnings ratio than FormFactor, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and recommmendations for Photronics and FormFactor, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Photronics presently has a consensus target price of $13.00, indicating a potential upside of 36.84%. FormFactor has a consensus target price of $18.40, indicating a potential upside of 17.95%. Given Photronics’ stronger consensus rating and higher possible upside, research analysts plainly believe Photronics is more favorable than FormFactor.
This table compares Photronics and FormFactor’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Photronics, Inc. is a manufacturer of photomasks, which are photographic quartz plates containing microscopic images of electronic circuits. As of October 30, 2016, the Company operated principally from nine manufacturing facilities: two located in Europe, three in Taiwan, one in Korea and three in the United States. Photomasks are used in the manufacture of semiconductors and flat panel displays (FPDs), and are used as masters to transfer circuit patterns onto semiconductor wafers and flat panel substrates during the fabrication of integrated circuits (ICs), and a range of FPDs and other types of electrical and optical components. The Company offers reticle and photomask maintenance, including pellicle replacement, mask cleaning and re-certification, at all its sites across the world. Its products include Mature Binary, Advanced Binary Reticles, Phase Shift Masks-Embedded Attenuated Phase Shift Masks (EAPSM), Other Advanced Products and Large Area Masks.
FormFactor, Inc. is a provider of test and measurement solutions. The Company’s segments include the Probe Cards segment and Systems segment. The Company designs, manufactures and sells multiple product lines, including probe cards, analytical probes, probe stations, integrated measurement systems, thermal sub-systems, reliability test systems, and related services. Its products provide electrical information from a range of semiconductor and electro-optical devices and integrated circuits (devices) from development to production. Probe Cards segment consists of probe card products and analytical probes. Systems segment consists of wafer probing, thermal and reliability products to enable precision on-wafer measurement of integrated circuits. Systems products are used in the early phases of the development and characterization of semiconductor processes.
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