O2Micro International Limited (NASDAQ: OIIM) and Cirrus Logic (NASDAQ:CRUS) 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, institutional ownership, profitability, valuation, analyst recommendations, risk and dividends.

Insider and Institutional Ownership

39.1% of O2Micro International Limited shares are held by institutional investors. Comparatively, 89.2% of Cirrus Logic shares are held by institutional investors. 8.0% of O2Micro International Limited shares are held by company insiders. Comparatively, 1.9% of Cirrus Logic shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares O2Micro International Limited and Cirrus Logic’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
O2Micro International Limited $59.82 million 0.68 -$3.45 million ($0.07) -22.57
Cirrus Logic $1.60 billion 2.21 $413.94 million $4.18 13.24

Cirrus Logic has higher revenue and earnings than O2Micro International Limited. O2Micro International Limited is trading at a lower price-to-earnings ratio than Cirrus Logic, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings for O2Micro International Limited and Cirrus Logic, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
O2Micro International Limited 0 0 0 0 N/A
Cirrus Logic 1 3 8 0 2.58

Cirrus Logic has a consensus target price of $69.18, suggesting a potential upside of 25.03%. Given Cirrus Logic’s higher probable upside, analysts clearly believe Cirrus Logic is more favorable than O2Micro International Limited.

Profitability

This table compares O2Micro International Limited and Cirrus Logic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
O2Micro International Limited -2.59% 0.01% 0.01%
Cirrus Logic 17.38% 26.71% 20.92%

Risk & Volatility

O2Micro International Limited has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500. Comparatively, Cirrus Logic has a beta of 0.01, suggesting that its share price is 99% less volatile than the S&P 500.

Summary

Cirrus Logic beats O2Micro International Limited on 10 of the 12 factors compared between the two stocks.

O2Micro International Limited Company Profile

O2Micro International Limited designs, develops and markets power management components for the Computer, Consumer, Industrial, Automotive and Communications markets. The Company’s power management products include integrated circuits (ICs) for liquid crystal display (LCD) and light emitting diode (LED) lighting; control and monitoring of battery charging and discharging; direct current (DC)/DC and alternating current (AC)/DC conversion, and provide select and switch functionality between power sources. It offers a range of products, including desktop and notebook monitors, portable media players, digital cameras, battery management systems for power tools, electric bikes, low emission vehicles (LEV) applications, industrial personal computers (PCs), portable media devices, smart phones, personal digital assistants (PDAs), global positioning system (GPS) units for navigational assistance in vehicles and electric and hybrid vehicle (EV/HEV) battery management.

Cirrus Logic Company Profile

Cirrus Logic, Inc. is engaged in providing integrated circuits (ICs) for audio and voice signal processing applications. The Company develops analog and mixed-signal ICs for a range of customers. The Company offers two product lines: Portable Audio, and Non-Portable Audio and Other. The Company’s primary facility housing engineering, sales and marketing, and administration functions is located in Austin, Texas. The Company offers products through both direct and indirect sales channels across the world. The Company’s portable audio products include analog and mixed-signal components designed for mobile devices including smartphones, tablets, digital headsets, wearables, smart accessories and portable media players. Its non-portable audio and other products include analog and mixed-signal components targeting the consumer market, including smart home applications, and the automotive, energy and industrial markets.

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