Critical Survey: MagnaChip Semiconductor Corporation (MX) vs. EZchip Semiconductor (EZCH)

MagnaChip Semiconductor Corporation (NYSE: MX) and EZchip Semiconductor (NASDAQ:EZCH) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Institutional & Insider Ownership

94.1% of MagnaChip Semiconductor Corporation shares are owned by institutional investors. 3.8% of MagnaChip Semiconductor Corporation shares are owned 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 Ratings

This is a breakdown of current ratings for MagnaChip Semiconductor Corporation and EZchip Semiconductor, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MagnaChip Semiconductor Corporation 0 1 1 0 2.50
EZchip Semiconductor 0 0 0 0 N/A

MagnaChip Semiconductor Corporation presently has a consensus price target of $13.00, indicating a potential upside of 7.00%. Given MagnaChip Semiconductor Corporation’s higher probable upside, equities analysts plainly believe MagnaChip Semiconductor Corporation is more favorable than EZchip Semiconductor.

Profitability

This table compares MagnaChip Semiconductor Corporation and EZchip Semiconductor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MagnaChip Semiconductor Corporation -1.24% N/A -6.37%
EZchip Semiconductor 17.05% 6.03% 5.64%

Volatility & Risk

MagnaChip Semiconductor Corporation has a beta of -0.41, indicating that its share price is 141% less volatile than the S&P 500. Comparatively, EZchip Semiconductor has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500.

Earnings & Valuation

This table compares MagnaChip Semiconductor Corporation and EZchip Semiconductor’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
MagnaChip Semiconductor Corporation $687.97 million 0.60 -$29.61 million ($0.46) -26.41
EZchip Semiconductor N/A N/A N/A ($0.17) -149.94

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

About MagnaChip Semiconductor Corporation

MagnaChip Semiconductor Corporation is a designer and manufacturer of analog and mixed-signal semiconductor products for consumer, computing, communication, industrial, automotive and Internet of Things (IoT) applications. The Company provides technology platforms for analog, mixed signal, power, high voltage, non-volatile memory and Radio Frequency (RF) applications. The Company has two segments: Foundry Services Group and Standard Products Group. The Company’s Foundry Services Group provides analog and mixed-signal foundry services to semiconductor companies and Integrated Device Manufacturers (IDMs) that serve consumer, computing, communication, industrial, automotive and IoT applications. The Company manufactures wafers-based on its customers’ product designs. The Company’s Standard Products Group includes its Display Solutions and Power Solutions business lines.

About EZchip Semiconductor

EZchip Semiconductor Ltd.is a fabless semiconductor company that provides data-path processing solutions for a range of applications for carrier, cloud and data center networks. The Company’s portfolio of solutions includes network processors, multi-core processors, network adapters and appliances with a software ecosystem. It designs and sells network processors for networking equipment, integrating several key functions into a single chip. Networking equipment vendors use the Company’s network processors to form the silicon core of networking equipment, such as switches and routers, for voice, video and data integration in a variety of applications. The Company’s network processors are single-chip solutions that enable its customers to design multi-port line cards. Its multi-core processors allow customers to design systems that are high performance, as well as power efficient. The Company’s subsidiaries include EZchip Technologies Ltd., EZchip Inc. and EZchip Semiconductor Inc.

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