Applied Micro Circuits (NASDAQ: AMCC) and Intermolecular (NASDAQ:IMI) are both technology companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, valuation, earnings and dividends.

Risk and Volatility

Applied Micro Circuits has a beta of 1.81, suggesting that its share price is 81% more volatile than the S&P 500. Comparatively, Intermolecular has a beta of 0.99, suggesting that its share price is 1% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Applied Micro Circuits and Intermolecular, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Applied Micro Circuits 0 4 0 0 2.00
Intermolecular 0 1 0 0 2.00

Applied Micro Circuits presently has a consensus target price of $8.00, indicating a potential downside of 5.33%. Given Applied Micro Circuits’ higher possible upside, equities research analysts plainly believe Applied Micro Circuits is more favorable than Intermolecular.

Earnings & Valuation

This table compares Applied Micro Circuits and Intermolecular’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Applied Micro Circuits N/A N/A N/A ($0.38) -22.24
Intermolecular $39.08 million 1.33 -$5.32 million ($0.38) -2.76

Applied Micro Circuits has higher revenue, but lower earnings than Intermolecular. Applied Micro Circuits is trading at a lower price-to-earnings ratio than Intermolecular, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Applied Micro Circuits and Intermolecular’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Applied Micro Circuits -11.11% -16.63% -13.04%
Intermolecular -47.22% -43.57% -35.71%

Institutional and Insider Ownership

73.3% of Applied Micro Circuits shares are owned by institutional investors. Comparatively, 38.0% of Intermolecular shares are owned by institutional investors. 12.4% of Applied Micro Circuits shares are owned by company insiders. Comparatively, 45.4% of Intermolecular shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Applied Micro Circuits beats Intermolecular on 6 of the 8 factors compared between the two stocks.

About Applied Micro Circuits

Applied Micro Circuits Corporation (AMCC) provides silicon solutions for cloud infrastructure and data centers, as well as connectivity products for edge, metro and long haul communications equipment. The Company’s products serve Computing and Connectivity markets. Its Computing products include the X-Gene family of server processors, based on the ARMv8 64-bit Instruction Set Architecture (ISA), which target mainstream cloud and data center infrastructure, including hyperscale, telco, enterprise and high performance computing. It also offers embedded computing products, which include HeliX family of processors, based on the ARM 64-bit ISA and its PowerPC products, based on Power Architecture. Its embedded Computing products are deployed in various applications, including networking and telecom, enterprise storage and industrial applications. The Connectivity business includes X-Weave family of products for service providers and public cloud, private cloud and enterprise data centers.

About Intermolecular

Intermolecular, Inc. provides thin film solutions. The Company’s high productivity combinatorial (HPC) platform, which consists of its tempus processing tools, its automated characterization methods, and its Informatics analysis software, is purpose-built for research and development (R&D) using combinatorial process systems. It develops technology and Internet protocol (IP) rights focused on materials, processes, integration and device architectures in collaboration with its customers. Its HPC platform consists of tempus HPC processing, automated characterization and informatics and analysis software. The Company offers a series of wet processing tools and dry processing tools. Its informatics software includes workflow management software, analysis and reporting software, security and collaboration management software, and integration services. It caters to semiconductor device, semiconductor materials and equipment and clean energy market companies.

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