Cohu (NASDAQ: COHU) and Camtek (NASDAQ:CAMT) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, valuation and dividends.

Analyst Ratings

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

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cohu 0 2 2 0 2.50
Camtek 0 1 1 0 2.50

Cohu currently has a consensus price target of $23.67, suggesting a potential upside of 35.01%. Camtek has a consensus price target of $7.00, suggesting a potential upside of 62.41%. Given Camtek’s higher possible upside, analysts clearly believe Camtek is more favorable than Cohu.

Risk and Volatility

Cohu has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, Camtek has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500.

Profitability

This table compares Cohu and Camtek’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cohu 6.21% 11.59% 7.76%
Camtek 2.56% 15.32% 10.10%

Insider & Institutional Ownership

78.2% of Cohu shares are owned by institutional investors. Comparatively, 18.2% of Camtek shares are owned by institutional investors. 6.0% of Cohu shares are owned by insiders. Comparatively, 79.4% of Camtek shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Cohu pays an annual dividend of $0.24 per share and has a dividend yield of 1.4%. Camtek does not pay a dividend. Cohu pays out 34.8% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Cohu and Camtek’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Cohu $314.92 million 1.56 $37.41 million $0.69 25.41
Camtek $116.68 million 1.31 $13.85 million $0.08 53.88

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

Summary

Cohu beats Camtek on 9 of the 15 factors compared between the two stocks.

Cohu Company Profile

Cohu, Inc. is a supplier of semiconductor test and inspection handlers, micro-electro mechanical system (MEMS) test modules, test contactors and thermal sub-systems used by global semiconductor manufacturers and test subcontractors. It develops, manufactures, sells and services a line of equipment capable of handling a range of integrated circuits and light-emitting diodes. It operates through semiconductor equipment segment. It offers products for the pick-and-place, gravity-feed, test-in-strip and turret handling, MEMS, burn-in and system-level test markets. It sells various products, including Delta MATRiX, Delta Pyramid, Delta Eclipse, Delta LinX, Rasco SO1000, Rasco SO2000, Rasco Saturn and Jupiter, Rasco Jaguar, Ismeca NY32, Ismeca NY20 and Delta Fusion HD. Its manufacturing operations are located in Malacca, Malaysia (handlers); Poway, California (thermal subsystems); Laguna, the Philippines (kits and contactors); Kolbermoor, Germany (handlers), and Osaka, Japan (contactors).

Camtek Company Profile

Camtek Ltd. provides automated and technological solutions for production processes and products yield, enabling and supporting customers’ technologies in the semiconductor fabrication and printed circuit board (PCB) industries. The Company designs, develops, manufactures and markets products mainly based on two core technologies: automated optical inspection (AOI) and functional ink technology (FIT). The Company’s AOI systems are computerized systems that optically inspect various types of electronic product components for defects caused during the manufacturing process. Its AOI systems are used for both production processes and for manufacturers in the semiconductor fabrication industry, as well as the printed circuit board industry. The Company’s AOI products incorporate image processing software and algorithms, as well as electro-optics and precision mechanics. In addition, the Company’s AOI systems use technology to handle a range of inspection and verification needs.

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