Financial Comparison: Xilinx (XLNX) and NeoPhotonics (NPTN)

Xilinx (NASDAQ: XLNX) and NeoPhotonics (NYSE:NPTN) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.

Insider and Institutional Ownership

89.1% of Xilinx shares are held by institutional investors. Comparatively, 82.7% of NeoPhotonics shares are held by institutional investors. 0.4% of Xilinx shares are held by insiders. Comparatively, 16.7% of NeoPhotonics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Xilinx pays an annual dividend of $1.44 per share and has a dividend yield of 2.1%. NeoPhotonics does not pay a dividend. Xilinx has increased its dividend for 7 consecutive years.

Volatility and Risk

Xilinx has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, NeoPhotonics has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500.

Profitability

This table compares Xilinx and NeoPhotonics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Xilinx 20.18% 29.98% 14.36%
NeoPhotonics -20.72% -26.15% -13.15%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Xilinx and NeoPhotonics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Xilinx 2 10 9 0 2.33
NeoPhotonics 0 5 4 1 2.60

Xilinx currently has a consensus price target of $74.00, indicating a potential upside of 5.38%. NeoPhotonics has a consensus price target of $9.00, indicating a potential upside of 33.53%. Given NeoPhotonics’ stronger consensus rating and higher possible upside, analysts plainly believe NeoPhotonics is more favorable than Xilinx.

Earnings and Valuation

This table compares Xilinx and NeoPhotonics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Xilinx $2.54 billion 7.01 $512.38 million N/A N/A
NeoPhotonics $292.89 million 1.03 -$53.33 million ($1.10) -6.13

Xilinx has higher revenue and earnings than NeoPhotonics.

Summary

Xilinx beats NeoPhotonics on 12 of the 16 factors compared between the two stocks.

About Xilinx

Xilinx, Inc. designs and develops programmable devices and associated technologies worldwide. Its programmable devices comprise integrated circuits (ICs) in the form of programmable logic devices (PLDs), such as programmable system on chips, and three dimensional ICs; adaptive compute acceleration platform; software design tools to program the PLDs; software development environments and embedded platforms; targeted reference designs; printed circuit boards; and intellectual property (IP) core licenses covering Ethernet, memory controllers, Interlaken, and peripheral component interconnect express interfaces, as well as domain-specific IP in the areas of embedded, digital signal processing and connectivity, and market-specific IP cores. The company also offers development boards; development kits, including hardware, design tools, IP, and reference designs that are designed to streamline and accelerate the development of domain-specific and market-specific applications; and configuration products, such as one-time programmable and in-system programmable storage devices to configure field programmable gate arrays. In addition, it provides design, customer training, field engineering, and technical support services. The company offers its products to electronic equipment manufacturers in sub-segments, such as wireline and data center, wireless, aerospace and defense, test and measurement, industrial, scientific and medical, automotive, audio, video and broadcast, and consumer. Xilinx, Inc. sells its products through a network of independent distributors; and through direct sales to original equipment manufacturers and electronic manufacturing service providers, as well as independent sales representatives. The company was founded in 1984 and is headquartered in San Jose, California.

About NeoPhotonics

NeoPhotonics Corporation develops, manufactures, and sells optoelectronic products that transmit, receive, and switch high speed digital optical signals for communications networks. It offers high speed products, including transmitter, receiver, and switching products for 100G (gigabits per second) and optical transmission applications over distances of 2 to 2,000 kilometers; optical components for coherent systems, including narrow linewidth tunable transmit and local oscillator lasers (NLW-ITLA) that generate ultra-pure wavelength or color for coherent transmission, as well as coherent micro-modulators, which encode the information on the intensity and phase of the optical beam; and integrated coherent receivers (ICRs) that decode the phase and polarization encoded coherent signals. The company also engages in developing pluggable coherent modules that combine NLW-ITLA with ICR and a coherent modulator; and offers 100G products for the client side and datacenter applications. In addition, it offers network products and solutions, including application-specific passive optical functionalities in modules or sub-system configurations; transceiver modules for various low speed access and mobile backhaul applications; and products for test and measurement, instrumentation, industrial, and research applications. The company sells its products to network equipment manufacturers through a direct sales force in North America, Europe, Russia, Asia, and internationally. The company was formerly known as NanoGram Corporation and changed its name to NeoPhotonics Corporation in 2002. NeoPhotonics Corporation was founded in 1996 and is headquartered in San Jose, California.

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