Both Cohu, Inc (NASDAQ:$COHU) and Axcelis Technologies (NASDAQ:$ACLS) are computer technology companies. Both are small-cap. However, how do they stack up against one another as an investment? Let’s look at the facts.
About the Companies
Cohu, Inc is a US-based company that develops, manufactures, and sells equipment that can handle a range of integrated and light-emitting diodes. Their products include test and inspection handlers, micro-electro mechanical system test modules, test contractors, and thermal subsystems used by other semiconductor manufacturers. The products have a wide arrange of capabilities including burn-in, pick-and-place, test-in-strip, turret handling, gravity-feed, MEMS, and system level test markets.
Axcelis Technologies, Inc, on the other hand, designs and manufactures ion implants and processing equipment used by their customers to fabricate semiconductor chips. Based in the US, Axcelis offers a line of medium current and high energy and current implanters. They also provide aftermarket products and services including spare parts, equipment upgrades, tools, maintenance services, and customer training.
Valuations
First up, Cohu had a Price/Earnings Ratio of 32.28 with an EPS of $0.69 and a Price/Sales Ratio of 1.98. Their Gross Revenue was $314.92 million.
Axcelis had a Price/Earnings Ratio of 26.65 with an EPS of $0.91 and a Price/Sales Ratio of 2.33. Their Gross Revenue was $324.69 million.
This valuation gives Cohu an edge in higher revenue. However, Axcelis’ lower price-to-earnings ratio hints that it is currently the more economical stock.
Profitability
Cohu had a Return on Equity and a Return on Assets of 12.52% and 8.41% respectively, for a Net Margin of 6.21%. Whereas Axcelis had a Return on Equity and a Return on Assets of 12.52% and 8.41% for a Net Margin of 9.10%.
Risk & Volatility
Cohu has a beta of 0.88, slightly below the S&P 500 by 12%. Axcelis, on the other hand, has a beta of 1.08, putting it above the S&P 500 by 8% and making it the riskier of the two investments.
Insider & Institutional Stock
6.0% of Cohu’s shares are owned by insiders. Axcelis is 5.7% owned by insiders. Cohu’s shares are 83.9% held by institutional investors, whereas Axcelis is at 75.3%. As institutional ownership is a strong indicator that there is faith in the company, Cohu has a slight edge.
Analysts
4 Analysts have taken a look at the two companies.
Cohu has a consensus target price of $23.75, which determines a possible upside of 6.65%. The company has 1 ‘Hold’ rating and 3 ‘Buy’ ratings from Analysts. Axcelis has a target has a consensus target price of $25.60, which gives a potential upside of 5.57%. The company also has 1 ‘Hold’ rating and 3 ‘Buy’ ratings, giving both companies an identical 2.75 Rating Score.
Overall
Despite higher revenue and less volatility, Cohu loses to Axcelis in 9 out of the 14 factors compared. This makes Axcelis the statistically better stock, largely due to its solid valuation and higher profitability.
Featured Image: Depositphotos/© ra2studio
