Financial Contrast: ASML (ASML) vs. Ultratech (UTEK)

Ultratech (NASDAQ: UTEK) and ASML (NASDAQ:ASML) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, dividends and valuation.

Dividends

ASML pays an annual dividend of $1.11 per share and has a dividend yield of 0.6%. Ultratech does not pay a dividend. ASML pays out 18.2% of its earnings in the form of a dividend.

Volatility and Risk

Ultratech has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500. Comparatively, ASML has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500.

Earnings & Valuation

This table compares Ultratech and ASML’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ultratech N/A N/A N/A $0.57 53.04
ASML $10.23 billion 8.47 $2.39 billion $6.10 33.02

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Ultratech and ASML, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ultratech 0 3 0 0 2.00
ASML 0 3 10 0 2.77

Ultratech currently has a consensus price target of $28.88, suggesting a potential downside of 4.47%. ASML has a consensus price target of $191.00, suggesting a potential downside of 5.17%. Given Ultratech’s higher probable upside, equities analysts clearly believe Ultratech is more favorable than ASML.

Profitability

This table compares Ultratech and ASML’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ultratech 5.17% 3.22% 2.83%
ASML 24.28% 21.16% 12.43%

Insider and Institutional Ownership

92.7% of Ultratech shares are owned by institutional investors. Comparatively, 16.6% of ASML shares are owned by institutional investors. 5.9% of Ultratech shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

ASML beats Ultratech on 9 of the 14 factors compared between the two stocks.

About Ultratech

Ultratech, Inc. (Ultratech) develops, manufactures and markets photolithography, laser thermal processing and inspection equipment. The Company operates through the manufacture and distribution of capital equipment to manufacturers of integrated circuits and nanotechnology components segment. The Company serves manufacturers of semiconductor devices, including packaging processes and various nanotechnology components such as laser diodes, high-brightness light emitting diodes (HBLEDs) and micro-electro-mechanical systems (MEMS), as well as atomic layer deposition systems (ALD) for customers located throughout the world. It has operations in North America, Europe, Singapore, Japan, Taiwan, Korea and the rest of Asia. The Company supplies step-and-repeat photolithography systems based on one-to-one (1X) imaging technology to customers located throughout North America, Europe and Asia.

About ASML

ASML Holding N.V. is a holding company. The Company is a manufacturer of chip-making equipment. The Company is engaged in the development, production, marketing, selling and servicing of semiconductor equipment systems, consisting of lithography systems. The Company’s products include systems, and installed base products and services. The Company’s principal operations are in the Netherlands, the United States and Asia. The Company offers TWINSCAN systems, equipped with lithography system with a mercury lamp as light source (i-line), Krypton Fluoride (KrF) and Argon Fluoride (ArF) light sources for 300 millimeter processing wafers for manufacturing environments for which imaging at a small resolution is required. TWINSCAN systems also include immersion lithography systems (TWINSCAN immersion systems). The Company also offers NXE systems, which are equipped with extreme ultraviolet (EUV) light source technology. The Company offers YieldStar, a wafer metrology system.

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