Analyzing United Microelectronics (NYSE:UMC) and SCI Engineered Materials (OTCMKTS:SCIA)

United Microelectronics (NYSE:UMC) and SCI Engineered Materials (OTCMKTS:SCIA) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, earnings, institutional ownership, dividends, valuation, analyst recommendations and risk.

Earnings and Valuation

This table compares United Microelectronics and SCI Engineered Materials”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Microelectronics	$7.57 billion	6.63	$1.29 billion	$1.07	18.62
SCI Engineered Materials	$19.61 million	2.07	$1.75 million	$0.59	15.44

United Microelectronics has higher revenue and earnings than SCI Engineered Materials. SCI Engineered Materials is trading at a lower price-to-earnings ratio than United Microelectronics, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for United Microelectronics and SCI Engineered Materials, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Microelectronics	3	1	1	1	2.00
SCI Engineered Materials	0	0	0	0	0.00

United Microelectronics presently has a consensus target price of $8.60, indicating a potential downside of 56.83%. Given United Microelectronics’ stronger consensus rating and higher probable upside, analysts plainly believe United Microelectronics is more favorable than SCI Engineered Materials.

Profitability

This table compares United Microelectronics and SCI Engineered Materials’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Microelectronics	33.18%	21.00%	13.87%
SCI Engineered Materials	8.97%	18.52%	13.39%

Volatility and Risk

United Microelectronics has a beta of 1.6, indicating that its share price is 60% more volatile than the S&P 500. Comparatively, SCI Engineered Materials has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500.

Insider and Institutional Ownership

5.0% of United Microelectronics shares are held by institutional investors. Comparatively, 27.6% of SCI Engineered Materials shares are held by institutional investors. 8.0% of United Microelectronics shares are held by company insiders. Comparatively, 19.3% of SCI Engineered Materials shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

United Microelectronics beats SCI Engineered Materials on 13 of the 15 factors compared between the two stocks.

About United Microelectronics

United Microelectronics Corporation operates as a semiconductor wafer foundry in Taiwan, China, Hong Kong, Japan, Korea, the United States, Europe, and internationally. The company provides circuit design, mask tooling, wafer fabrication, and assembly and testing services. It serves fabless design companies and integrated device manufacturers. United Microelectronics Corporation was incorporated in 1980 and is headquartered in Hsinchu City, Taiwan.

About SCI Engineered Materials

SCI Engineered Materials, Inc. engages in the manufacture and supply of materials for physical vapor deposition thin film applications in the United States. It offers ceramic targets, metal sputtering targets, and backing plates for use in semiconductors, thin film solar, flat panel displays, defense, aerospace, and photonics industries. The company’s materials are used to produce nano layers of metals and oxides for advanced material systems; and in applying decorative coatings for end uses, such as sink faucets to produce various electronic, photonic, and semiconductor products. It serves domestic and multi-national corporations, universities, and research institutions. The company was formerly known as Superconductive Components, Inc. and changed its name to SCI Engineered Materials, Inc. in 2007. SCI Engineered Materials, Inc. was incorporated in 1987 and is headquartered in Columbus, Ohio.