Alpha and Omega Semiconductor Limited (NASDAQ: AOSL) and Skyworks Solutions (NASDAQ:SWKS) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Valuation & Earnings

This table compares Alpha and Omega Semiconductor Limited and Skyworks Solutions’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Alpha and Omega Semiconductor Limited $383.34 million 1.11 $39.73 million $0.56 31.77
Skyworks Solutions $3.50 billion 5.52 $1.45 billion $5.21 20.18

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

Risk & Volatility

Alpha and Omega Semiconductor Limited has a beta of 0.28, suggesting that its share price is 72% less volatile than the S&P 500. Comparatively, Skyworks Solutions has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.

Dividends

Skyworks Solutions pays an annual dividend of $1.28 per share and has a dividend yield of 1.2%. Alpha and Omega Semiconductor Limited does not pay a dividend. Skyworks Solutions pays out 24.6% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and price targets for Alpha and Omega Semiconductor Limited and Skyworks Solutions, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alpha and Omega Semiconductor Limited 0 1 3 0 2.75
Skyworks Solutions 1 4 21 1 2.81

Alpha and Omega Semiconductor Limited currently has a consensus price target of $26.00, indicating a potential upside of 46.15%. Skyworks Solutions has a consensus price target of $112.21, indicating a potential upside of 6.71%. Given Alpha and Omega Semiconductor Limited’s higher possible upside, research analysts clearly believe Alpha and Omega Semiconductor Limited is more favorable than Skyworks Solutions.

Institutional & Insider Ownership

69.9% of Alpha and Omega Semiconductor Limited shares are held by institutional investors. Comparatively, 80.8% of Skyworks Solutions shares are held by institutional investors. 21.7% of Alpha and Omega Semiconductor Limited shares are held by company insiders. Comparatively, 0.5% of Skyworks Solutions shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Alpha and Omega Semiconductor Limited and Skyworks Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alpha and Omega Semiconductor Limited 3.61% 4.76% 3.71%
Skyworks Solutions 27.86% 28.67% 26.04%

Summary

Skyworks Solutions beats Alpha and Omega Semiconductor Limited on 13 of the 17 factors compared between the two stocks.

Alpha and Omega Semiconductor Limited Company Profile

Alpha and Omega Semiconductor Limited is a designer, developer and global supplier of power semiconductors. The Company’s portfolio of power semiconductors includes approximately 1,600 products, as of June 30, 2016. The Company’s product portfolio consists of two categories: power discretes and power integrated circuits (ICs). The Company’s portfolio of products focuses high-volume applications, including personal computers, flat panel televisions, light-emitting diode (LED) lighting, smart phones, battery packs, consumer and industrial motor controls and power supplies for television, computers, servers and telecommunications equipment. The Company sells its products primarily to distributors in the Asia Pacific region, who in turn sell these products to end customers. The Company conducts its operations primarily in the United States, Hong Kong, China, Taiwan, Korea and Japan. Its products are applicable in desktop and tablet personal computers, flat panel displays and televisions.

Skyworks Solutions Company Profile

Skyworks Solutions Inc. designs, develops, manufactures and markets semiconductor products, including intellectual property. The Company’s analog semiconductors are connecting people, places, and things, spanning a number of new and unimagined applications within the automotive, broadband, cellular infrastructure, connected home, industrial, medical, military, smartphone, tablet and wearable markets. Its geographical segments include the United States, Other Americas, China, Taiwan, South Korea, Other Asia-Pacific, Europe, Middle East and Africa. It operates throughout the world with engineering, manufacturing, sales and service facilities throughout Asia, Europe and North America. It is engaged with key original equipment manufacturers (OEM), smartphone providers and baseband reference design partners. Its product portfolio consists of various solutions, including amplifiers, attenuators, detectors, diodes, filters, front-end modules, hybrid, mixers, switches, and modulators.

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