Contrasting KLA (NASDAQ:KLAC) & XCHG (NASDAQ:XCH)

XCHG (NASDAQ:XCH) and KLA (NASDAQ:KLAC) are both computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Valuation & Earnings

This table compares XCHG and KLA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
XCHG	$34.50 million	1.86	-$11.94 million	($0.08)	-13.50
KLA	$12.16 billion	15.13	$4.06 billion	$31.85	43.96

KLA has higher revenue and earnings than XCHG. XCHG is trading at a lower price-to-earnings ratio than KLA, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

XCHG has a beta of -0.85, indicating that its share price is 185% less volatile than the S&P 500. Comparatively, KLA has a beta of 1.45, indicating that its share price is 45% more volatile than the S&P 500.

Insider and Institutional Ownership

86.7% of KLA shares are held by institutional investors. 91.5% of KLA shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations for XCHG and KLA, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
XCHG	1	0	0	0	1.00
KLA	0	12	14	0	2.54

KLA has a consensus price target of $1,290.92, indicating a potential downside of 7.79%. Given KLA’s stronger consensus rating and higher probable upside, analysts plainly believe KLA is more favorable than XCHG.

Profitability

This table compares XCHG and KLA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
XCHG	N/A	N/A	N/A
KLA	33.83%	107.26%	29.60%

Summary

KLA beats XCHG on 14 of the 14 factors compared between the two stocks.

About XCHG

XCHG Limited, branded as XCharge, is a company whose subsidiaries design, manufacture, and sell electric vehicle (EV) charging solutions under the X-Charge name in Europe, China, the United States, and other international markets. The company focuses on DC fast-charging infrastructure, including its C6 and C7 series chargers and Net Zero battery-integrated fast-charging systems, and also provides related software upgrades and hardware maintenance services for EV manufacturers, energy companies, and charge point operators. Founded in 2015, XCHG positions itself as a global provider of integrated EV charging solutions that combine high-power charging with smart energy management.

About KLA

KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection. The company offers inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers; chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk. It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, inkjet and additive printing, UV laser drilling, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.