Analyzing Tokyo Electron (OTCMKTS:TOELY) and Arteris (NASDAQ:AIP)

Arteris (NASDAQ:AIP) and Tokyo Electron (OTCMKTS:TOELY) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, analyst recommendations, profitability, institutional ownership and valuation.

Profitability

This table compares Arteris and Tokyo Electron’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arteris	-68.70%	-150.71%	-34.46%
Tokyo Electron	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of current ratings and target prices for Arteris and Tokyo Electron, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arteris	0	0	4	0	3.00
Tokyo Electron	0	0	0	1	4.00

Arteris presently has a consensus target price of $16.00, indicating a potential upside of 140.60%. Given Arteris’ higher possible upside, research analysts clearly believe Arteris is more favorable than Tokyo Electron.

Volatility & Risk

Arteris has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, Tokyo Electron has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500.

Valuation & Earnings

This table compares Arteris and Tokyo Electron’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arteris	$53.67 million	4.69	-$36.87 million	($1.04)	-6.39
Tokyo Electron	$16.35 billion	6.40	$3.53 billion	N/A	N/A

Tokyo Electron has higher revenue and earnings than Arteris.

Institutional and Insider Ownership

64.4% of Arteris shares are held by institutional investors. Comparatively, 1.3% of Tokyo Electron shares are held by institutional investors. 36.1% of Arteris shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Tokyo Electron beats Arteris on 9 of the 13 factors compared between the two stocks.

About Arteris

Arteris, Inc. provides semiconductor interconnect intellectual property (IP) and System-on-Chip (Soc) Integration Automation software solutions (SIA) in the Americas, the Asia Pacific, Europe, and the Middle East. The company develops, licenses, and supports the on-chip interconnect fabric technology used in Soc designs and Network-on-Chip (NoC) interconnect IP. Its products include FlexNoC and FlexWay silicon-proven interconnect IP products; Ncore, a silicon-proven and cache coherent interconnect IP product that provides scalable, configurable, and area efficient characteristics; and CodaCache, a last-level cache semiconductor IP product. The company also offers SIA products comprising Magillem Connectivity that shortens and streamlines the SoC integration process; and Magillem Registers and CSRCompiler that addresses hardware-software integration challenges for SoCs. The company serves semiconductor manufacturers, original equipment manufacturers, hyperscale system houses, semiconductor design houses, and other producers of electronic systems. Arteris, Inc. was founded in 2003 and is headquartered in Campbell, California.

About Tokyo Electron

Tokyo Electron Limited, together with its subsidiaries, develops, manufactures, and sells semiconductor and flat panel display (FPD) production equipment in Japan, Europe, North America, Taiwan, China, South Korea, Southeast Asia, and internationally. The company offers coaters/developers, etch systems, surface preparation systems, deposition systems, test systems, wafer bonders/debonders, wafer edge trimming, SiC epitaxial CVD systems, gas cluster ion beam system, and cleaning systems. It also provides plasma etch/ash systems for use in the manufacture of FPDs, as well as inkjet printing systems for manufacturing OLED displays. In addition, the company offers delivery, facility management, and non-life insurance services; sells semiconductor products, board computer products, software, and other electronic components; sells and supports network/storage/middleware related solutions; and develops, manufactures, and sells magnetic annealing systems. Tokyo Electron Limited was incorporated in 1951 and is headquartered in Tokyo, Japan.