Comparing Atmel (ATML) & Magnachip Semiconductor (MX)

Atmel (NASDAQ: ATML) and Magnachip Semiconductor (NYSE:MX) are both technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, profitability, risk, institutional ownership, dividends, valuation and earnings.

Volatility & Risk

Atmel has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, Magnachip Semiconductor has a beta of -0.04, indicating that its share price is 104% less volatile than the S&P 500.

Earnings & Valuation

This table compares Atmel and Magnachip Semiconductor’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Atmel N/A N/A N/A $0.06 135.67
Magnachip Semiconductor $679.67 million 0.48 $84.94 million $1.95 4.85

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

Dividends

Atmel pays an annual dividend of $0.08 per share and has a dividend yield of 1.0%. Magnachip Semiconductor does not pay a dividend. Atmel pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional & Insider Ownership

95.0% of Magnachip Semiconductor shares are held by institutional investors. 3.8% of Magnachip Semiconductor shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Atmel and Magnachip Semiconductor, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atmel 0 0 0 0 N/A
Magnachip Semiconductor 0 1 1 0 2.50

Magnachip Semiconductor has a consensus target price of $13.00, suggesting a potential upside of 37.57%. Given Magnachip Semiconductor’s higher probable upside, analysts clearly believe Magnachip Semiconductor is more favorable than Atmel.

Profitability

This table compares Atmel and Magnachip Semiconductor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atmel 1.81% 2.18% 1.48%
Magnachip Semiconductor 12.50% -40.94% 5.43%

Summary

Magnachip Semiconductor beats Atmel on 9 of the 13 factors compared between the two stocks.

About Atmel

Atmel Corporation supplies microcontrollers. The Company operates through four segments: Microcontroller, Nonvolatile Memory, Automotive and Multi-Market and Other. The Microcontroller segment includes its microcontroller and microprocessor families; AVR 8-bit and 32-bit products; Atmel SMART ARM-based products; designated commercial wireless products, including low power radio and System-on-a-chip products; optimized products for smart energy, touch button, and mobile sensor hub and Light Emitting Diode (LED) lighting applications, and maXTouch capacitive touch product families. The Nonvolatile Memory segment includes electrically erasable programmable read-only, erasable programmable read-only memory devices and secure cryptographic products. The Automotive segment includes devices for automotive electronics, including products using radio frequency technology. The Multi-Market and Other segment includes application specific and standard products for aerospace applications.

About Magnachip Semiconductor

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.

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