Head-To-Head Review: KLA (NASDAQ:KLAC) vs. inTEST (NYSE:INTT)

inTEST (NYSE:INTT) and KLA (NASDAQ:KLAC) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Risk and Volatility

inTEST has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500. Comparatively, KLA has a beta of 1.45, meaning that its share price is 45% more volatile than the S&P 500.

Insider & Institutional Ownership

63.2% of inTEST shares are held by institutional investors. Comparatively, 86.7% of KLA shares are held by institutional investors. 5.2% of inTEST shares are held by insiders. Comparatively, 79.4% of KLA shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares inTEST and KLA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
inTEST	2.33%	5.31%	3.42%
KLA	35.57%	87.66%	29.23%

Earnings and Valuation

This table compares inTEST and KLA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
inTEST	$128.26 million	1.54	$9.34 million	$0.12	128.00
KLA	$13.58 billion	14.77	$4.83 billion	$3.67	41.87

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

Analyst Ratings

This is a summary of current ratings and target prices for inTEST and KLA, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
inTEST	0	1	2	0	2.67
KLA	0	10	19	0	2.66

inTEST currently has a consensus price target of $18.00, indicating a potential upside of 17.19%. KLA has a consensus price target of $221.26, indicating a potential upside of 43.99%. Given KLA’s higher probable upside, analysts plainly believe KLA is more favorable than inTEST.

Summary

KLA beats inTEST on 11 of the 14 factors compared between the two stocks.

About inTEST

inTEST Corporation provides test and process technology solutions for use in manufacturing and testing in automotive, defense/aerospace, industrial, life sciences, security, and semiconductor markets worldwide. The company operates through three segments: Electronic Test, Environmental Technologies, and Process Technologies. The Electronic Test segment offers in2, Cobal, and LS series manipulators that hold various test heads and enable an operator to reposition a test head for alternate use with various probers or handlers on a test floor; and docking hardware products, which protect the interface contacts and ensure proper repeatable and precise alignment between the test head’s interface board and the prober’s probing assembly. This segment also provides tester interfaces that offer electrical connections between the tester and the wafer prober or IC handler; scorpion flying probe test systems that designs and manufactures robotics-based electronic test equipment; and BRiZ automated test and programming services. Its products are used in production testing of wafers and specialized packaged ICs in back-end testing by semiconductor manufacturers. The Environmental Technologies segment provides ThermoStream products that are used in the semi market as a stand-alone temperature management tool, or in various electronic test applications; thermal chambers; thermal platforms; Thermonics temperature conditioning products that offer tempered gas or fluid; and ultra-cold storage solutions, including biomedical freezers, refrigerators, and mobile storage solutions. The Process Technologies segment offers EKOHEAT and EASYHEAT induction heating systems; and digital streaming and image capturing solutions. The company markets and sells its products to semiconductor manufacturers, third-party foundries, test and assembly providers, and original equipment manufacturers. inTEST Corporation was incorporated in 1981 and is headquartered in Mount Laurel, New Jersey.

About KLA

KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection. The company offers inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers; chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk. It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, inkjet and additive printing, UV laser drilling, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.