Contrasting Cree (CREE) and Adesto Technologies (IOTS)

Cree (NASDAQ:CREE) and Adesto Technologies (NASDAQ:IOTS) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.

Valuation & Earnings

This table compares Cree and Adesto Technologies’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cree $1.49 billion 2.78 -$279.96 million ($0.15) -269.53
Adesto Technologies $56.11 million 2.32 -$5.68 million ($0.24) -18.54

Adesto Technologies has lower revenue, but higher earnings than Cree. Cree is trading at a lower price-to-earnings ratio than Adesto Technologies, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

38.7% of Adesto Technologies shares are held by institutional investors. 0.6% of Cree shares are held by company insiders. Comparatively, 18.4% of Adesto Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for Cree and Adesto Technologies, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cree 1 10 5 0 2.25
Adesto Technologies 0 0 6 0 3.00

Cree presently has a consensus target price of $44.44, suggesting a potential upside of 9.93%. Adesto Technologies has a consensus target price of $10.00, suggesting a potential upside of 124.72%. Given Adesto Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe Adesto Technologies is more favorable than Cree.

Profitability

This table compares Cree and Adesto Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cree -17.60% -0.10% -0.08%
Adesto Technologies -11.29% -8.04% -3.65%

Risk & Volatility

Cree has a beta of 0.44, suggesting that its stock price is 56% less volatile than the S&P 500. Comparatively, Adesto Technologies has a beta of 1.67, suggesting that its stock price is 67% more volatile than the S&P 500.

Summary

Adesto Technologies beats Cree on 9 of the 14 factors compared between the two stocks.

Cree Company Profile

Cree, Inc. provides lighting-class light emitting diode (LED), lighting, and semiconductor products for power and radio-frequency (RF) applications in the United States, China, Europe, South Korea, Japan, Malaysia, Taiwan, and internationally. It operates in three segments: Wolfspeed, LED Products, and Lighting Products. The Wolfspeed segment offers silicon carbide (SiC) materials for RF, power switching, gemstones, and other applications. It also provides SiC power device products, including SiC Schottky diodes, metal oxide semiconductor field effect transistors (MOSFETs), power modules, and gate driver boards for electric vehicles, including charging infrastructure, server power supplies, solar inverters, uninterruptible power supplies, industrial power supplies, and other applications. In addition, this segment offers gallium nitride (GaN) die, high-electron mobility transistors (HEMTs), monolithic microwave integrated circuits (MMICs), and laterally diffused MOSFET (LDMOS) power transistors for telecommunications infrastructure, military, and other commercial applications; and custom die manufacturing services for GaN HEMTs and MMICs. The LED Products segment provides blue and green LED chip products for video screens, gaming displays, function indicator lights and automotive backlights, headlamps, and directional indicators. It also offers XLamp LED components and LED modules for lighting applications; and surface mount and through-hole packaged LED products for video, signage, general illumination, transportation, gaming, and specialty lighting applications. The Lighting Products segment offers LED lighting systems and lamps for to distributors, retailers, and customers for offices, retail spaces, restaurants, hospitality, schools, universities, manufacturing, healthcare, airports, municipal, residential, street lighting, parking structures, and other applications. The company was founded in 1987 and is headquartered in Durham, North Carolina.

Adesto Technologies Company Profile

Adesto Technologies Corporation, together with its subsidiaries, provides application-specific semiconductors for the Internet of Things (IoT) era. Its portfolio of semiconductor and embedded technologies are optimized for connected IoT devices used in industrial, consumer, communications, and medical applications. The company manufactures its products using industry-standard floating gate technology and conductive bridging random access memory technology platforms. Its products include DataFlash for data-logging applications, such as industrial automation, home automation sensing, and health and fitness tracking; Fusion Serial Flash for use in various high-volume consumer applications comprising wearables, mobile, and other applications; EcoXip that enables improved processor performance and reduced system power consumption; and Standard Serial Flash to store boot or program code with a low pin count industry standard serial interface. The company's products also comprise Mavriq for IoT and other applications, which include camera sensors, Bluetooth low energy devices, wearables, gaming components, printer cartridges, medical equipment, and other devices; and Moneta for retail beacons, wearable medical and fitness devices, industrial and environmental sensors, agricultural monitors, and other low energy/long battery life or energy harvesting system applications. The company sells its products through a network of representatives and distributors to original equipment manufacturers and original design manufacturers in the United States, Rest of Americas, Europe, the Asia Pacific, and internationally. Adesto Technologies Corporation was incorporated in 2006 and is headquartered in Santa Clara, California.

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