Critical Review: Vishay Intertechnology (NYSE:VSH) versus Omron (OTCMKTS:OMRNY)

Omron (OTCMKTS:OMRNY) and Vishay Intertechnology (NYSE:VSH) are both mid-cap technology companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, valuation, earnings, analyst recommendations and risk.

Institutional and Insider Ownership

1.1% of Omron shares are owned by institutional investors. Comparatively, 93.7% of Vishay Intertechnology shares are owned by institutional investors. 8.3% of Vishay Intertechnology shares are owned 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.

Dividends

Omron pays an annual dividend of $0.47 per share and has a dividend yield of 1.6%. Vishay Intertechnology pays an annual dividend of $0.40 per share and has a dividend yield of 1.8%. Omron pays out 44.8% of its earnings in the form of a dividend. Vishay Intertechnology pays out 64.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Volatility & Risk

Omron has a beta of 1.29, suggesting that its share price is 29% more volatile than the S&P 500. Comparatively, Vishay Intertechnology has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500.

Profitability

This table compares Omron and Vishay Intertechnology’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Omron	4.04%	3.68%	2.42%
Vishay Intertechnology	2.72%	3.80%	2.05%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Omron and Vishay Intertechnology, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Omron	0	2	0	0	2.00
Vishay Intertechnology	1	3	4	1	2.56

Vishay Intertechnology has a consensus target price of $35.86, indicating a potential upside of 62.92%. Given Vishay Intertechnology’s stronger consensus rating and higher possible upside, analysts clearly believe Vishay Intertechnology is more favorable than Omron.

Earnings and Valuation

This table compares Omron and Vishay Intertechnology”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Omron	$5.10 billion	1.20	$188.01 million	$1.05	28.28
Vishay Intertechnology	$3.32 billion	1.02	-$8.98 million	$0.62	35.50

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

Summary

Vishay Intertechnology beats Omron on 10 of the 17 factors compared between the two stocks.

About Omron

OMRON Corporation engages in industrial automation, device and module solutions, social systems, and healthcare businesses worldwide. The Industrial Automation Business offers sensors, switches, safety and control components, relays, motion and drives, robotics, energy conservation, power supplies, and automation system products. It also offers environmental mobility, digital devices, food and commodity, logistic and warehouse automation, medical, robotic, panel, vision, software, and traceability related solutions. The Social Systems, Solutions and Service Business provides energy, public transport, traffic safety, network protection, payment, infrastructure monitoring, management service, and DX solutions, as well as offers remote surveillance/monitoring, automation/robotics, software development, engineering/maintenance, and other services. The Healthcare Business provides cardiovascular, respiratory care, pain management, remote patient monitoring, and other solutions. The Device and Module Solutions Business offers relays, switches, connectors, and sensors. OMRON Corporation was founded in 1933 and is headquartered in Kyoto, Japan.

About Vishay Intertechnology

Vishay Intertechnology, Inc. manufactures and sells discrete semiconductors and passive electronic components in Asia, Europe, and the Americas. The company operates through Metal Oxide Semiconductor Field Effect Transistors (MOSFETs), Diodes, Optoelectronic Components, Resistors, Inductors, and Capacitors segments. The MOSFETs segment offers low- and medium-voltage TrenchFET MOSFETs, high-voltage planar MOSFETs, high voltage Super Junction MOSFETs, power integrated circuits, and integrated function power devices. The Diodes segment provides rectifiers, small signal diodes, protection diodes, thyristors/silicon-controlled rectifiers, and power modules. The Optoelectronic Components segment contains standard and customer specific optoelectronic components, such as infrared (IR) emitters and detectors, IR remote control receivers, optocouplers, solid-state relays, optical sensors, light-emitting diodes, 7-segment displays, and IR data transceiver modules. The Resistors segment offers resistors, which are basic components used in various forms of electronic circuitry to adjust and regulate levels of voltage and current. The Inductors segment provides inductors for use as an internal magnetic field to change alternating current phase and resist alternating current. The Capacitors segment offers capacitors, which store energy and discharge it when needed. It sells its products under Siliconix, Dale, Draloric, Beyschlag, Sfernice, MCB, UltraSource, Applied Thin-Film Products, IHLP, HiRel Systems, Sprague, Vitramon, Barry, Roederstein, ESTA, and BCcomponents brand names. The company serves industrial, automotive, telecommunications, computing, consumer products, power supplies, military and aerospace, and medical end markets. Vishay Intertechnology, Inc. was incorporated in 1962 and is headquartered in Malvern, Pennsylvania.