Advantest (OTCMKTS:ATEYY) versus Data I/O (NASDAQ:DAIO) Critical Contrast

Advantest (OTCMKTS:ATEYY) and Data I/O (NASDAQ:DAIO) are both technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, analyst recommendations, institutional ownership, dividends, valuation and earnings.

Profitability

This table compares Advantest and Data I/O’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Advantest	37.15%	58.10%	38.75%
Data I/O	-48.73%	-66.83%	-40.69%

Risk and Volatility

Advantest has a beta of 2.17, indicating that its stock price is 117% more volatile than the S&P 500. Comparatively, Data I/O has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for Advantest and Data I/O, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Advantest	0	0	0	2	4.00
Data I/O	1	1	1	2	2.80

Data I/O has a consensus target price of $5.11, suggesting a potential upside of 75.60%. Given Data I/O’s higher possible upside, analysts plainly believe Data I/O is more favorable than Advantest.

Earnings and Valuation

This table compares Advantest and Data I/O”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Advantest	$7.50 billion	25.46	$2.48 billion	$4.06	64.24
Data I/O	$17.77 million	1.54	-$5.24 million	($0.93)	-3.13

Advantest has higher revenue and earnings than Data I/O. Data I/O is trading at a lower price-to-earnings ratio than Advantest, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

0.0% of Advantest shares are held by institutional investors. Comparatively, 37.0% of Data I/O shares are held by institutional investors. 4.1% of Data I/O shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Advantest beats Data I/O on 10 of the 14 factors compared between the two stocks.

About Advantest

Advantest Corporation manufactures and sells semiconductors, component test system products, and mechatronics related products in Japan, the Americas, Europe, and Asia. The company operates through three segments: Semiconductor and Component Test System; Mechatronics Related Business; and Services, Support and Others. The Semiconductor and Component Test System segment provides customers with test system products for the semiconductor industry and the electronic parts industry, as well as offers test systems for SoC semiconductor devices, and test systems for memory semiconductors devices. The Mechatronics Related Business segment provides test handlers; mechatronic-applied products for handling semiconductor devices; and device interfaces, which serve as interfaces with the devices that are measured, as well as nano-technology related products. The Services, Support and Others segment provides test solutions of system level testing customer solutions for the semiconductor and modules, and support services. This segment is also involved in the sale of consumables and used products, and equipment lease and other businesses. It also engages in the research and development activities and provides maintenance and support services. The company was incorporated in 1946 and is headquartered in Tokyo, Japan.

About Data I/O

Data I/O Corporation, together with its subsidiaries, engages in the design, manufacture, and sale of programming and security deployment systems and services for electronic device manufacturers in the United States, Europe, and internationally. Its programming system products are used to program integrated circuits (ICs) with the specific data for the ICs. The company offers PSV handlers off-line automated programming systems, such as PSV2800 automated programming system which focuses on high-volume manufacturing in a lower cost platform; PSV7000 automated programming system for security deployment upgrades; PSV5000 automated programming system that combines mid-range capacity and supports security deployment; and PSV3500 automated programming system which provides basic programming needs. It also provides SentriX security deployment system; and LumenX and non-automated FlashPAK III programming systems. In addition, the company offers hardware support, system installation and repair, and device programming services. It markets and sells its products to original equipment manufacturers in automotive and consumer electronics, internet of things, and industrial, as well as electronic manufacturing service contract manufacturers through direct sales, and indirect sales representatives and distributors. Data I/O Corporation was incorporated in 1969 and is headquartered in Redmond, Washington.