Critical Comparison: Nova Measuring Instruments (NVMI) versus Spansion (CODE)

Nova Measuring Instruments (NASDAQ: NVMI) and Spansion (NYSE:CODE) are both technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, risk, institutional ownership, earnings, dividends and analyst recommendations.

Earnings and Valuation

This table compares Nova Measuring Instruments and Spansion’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nova Measuring Instruments $221.99 million 3.41 $9.64 million $1.64 16.52
Spansion N/A N/A N/A ($1.15) -33.50

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

Profitability

This table compares Nova Measuring Instruments and Spansion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nova Measuring Instruments 20.93% 25.05% 19.99%
Spansion -7.99% -18.66% -7.19%

Insider and Institutional Ownership

41.2% of Nova Measuring Instruments shares are owned by institutional investors. 1.0% of Nova Measuring Instruments shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and target prices for Nova Measuring Instruments and Spansion, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nova Measuring Instruments 0 0 3 0 3.00
Spansion 0 0 0 0 N/A

Nova Measuring Instruments presently has a consensus target price of $32.67, suggesting a potential upside of 20.54%. Given Nova Measuring Instruments’ higher probable upside, equities analysts clearly believe Nova Measuring Instruments is more favorable than Spansion.

Summary

Nova Measuring Instruments beats Spansion on 10 of the 10 factors compared between the two stocks.

About Nova Measuring Instruments

Nova Measuring Instruments Ltd. provides metrology solutions for the semiconductor manufacturing industry. The Company offers in-line Optical and x-ray stand-alone metrology systems, as well as integrated optical metrology systems, which are attached directly to wafer fabrication process equipment. Its metrology systems measure various film thickness and composition properties, as well as critical-dimension (CD) variables during various front-end and back-end of line steps in the semiconductor wafer fabrication process. Its product portfolio includes a set of in-situ, integrated and stand-alone metrology platforms suited for dimensional, films and material metrology measurements for process control across multiple semiconductor manufacturing process steps. Its products include NovaScan 2040, NovaScan 3090Next, Nova i500, Nova T500, Nova T600, Nova V2600 TSV metrology system, NovaMars, Nova Hybrid Metrology solution, Nova Fleet Management, VeraFlex II, VeraFlex III XF and QED.

About Spansion

Spansion Inc. (Spansion) is a designer, manufacturer and developer of embedded systems solutions. The Company’s embedded systems solutions address a variety of applications, including automotive, consumer electronics, networking and telecommunications equipment, tablets, personal computers (PCs), gaming consoles and industrial equipment with a range of products. The Company has two product groups for embedded applications: flash memory and microcontrollers/analog products. Its flash memory market consists of two architectures: NOR and NAND flash memory. NOR flash memory is used for code execution and storage in consumer electronics, automobiles, communications, gaming and industrial applications. NAND flash memory is used for data storage in applications, such as solid-state drives, removable storage devices and embedded managed NAND devices. The Company focuses on embedded markets, such as transportation, industrial, consumer, communications and gaming markets.

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