Applied Optoelectronics (NASDAQ:AAOI – Get Free Report) and SkyWater Technology (NASDAQ:SKYT – Get Free Report) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, earnings, institutional ownership, profitability and dividends.
Insider and Institutional Ownership
61.7% of Applied Optoelectronics shares are held by institutional investors. Comparatively, 70.0% of SkyWater Technology shares are held by institutional investors. 3.8% of Applied Optoelectronics shares are held by company insiders. Comparatively, 22.6% of SkyWater Technology shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current recommendations for Applied Optoelectronics and SkyWater Technology, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Applied Optoelectronics | 1 | 3 | 3 | 0 | 2.29 |
| SkyWater Technology | 1 | 6 | 1 | 0 | 2.00 |
Earnings and Valuation
This table compares Applied Optoelectronics and SkyWater Technology”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Applied Optoelectronics | $507.00 million | 23.26 | -$38.23 million | ($0.66) | -222.68 |
| SkyWater Technology | $541.53 million | 3.18 | $118.91 million | $2.33 | 15.04 |
SkyWater Technology has higher revenue and earnings than Applied Optoelectronics. Applied Optoelectronics is trading at a lower price-to-earnings ratio than SkyWater Technology, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Applied Optoelectronics has a beta of 3.66, suggesting that its share price is 266% more volatile than the S&P 500. Comparatively, SkyWater Technology has a beta of 3.32, suggesting that its share price is 232% more volatile than the S&P 500.
Profitability
This table compares Applied Optoelectronics and SkyWater Technology’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Applied Optoelectronics | -8.55% | -4.64% | -2.90% |
| SkyWater Technology | 21.04% | -7.88% | -1.93% |
Summary
SkyWater Technology beats Applied Optoelectronics on 9 of the 14 factors compared between the two stocks.
About Applied Optoelectronics
Applied Optoelectronics, Inc. designs, manufactures, and sells fiber-optic networking products in the United States, Taiwan, and China. It offers optical modules, optical filters, lasers, laser components, subassemblies, transmitters and transceivers, turn-key equipment, headend, node, distribution equipment, and amplifiers. The company sells its products to internet data center operators, cable television, telecom equipment manufacturers, fiber-to-the-home, and internet service providers through its direct and indirect sales channels. Applied Optoelectronics, Inc. was incorporated in 1997 and is headquartered in Sugar Land, Texas.
About SkyWater Technology
SkyWater Technology, Inc., together with its subsidiaries, operates as a pure-play technology foundry that engages in the provision of semiconductor development, manufacturing, and packaging services in the United States. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, micro-electromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive, bio-health, consumer, and industrial sectors. The company was incorporated in 2016 and is headquartered in Bloomington, Minnesota.
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