EZchip Semiconductor (EZCH) & Celestica (CLS) Critical Analysis
EZchip Semiconductor (NASDAQ: EZCH) and Celestica (NYSE:CLS) are both small-cap semiconductors – nec companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, profitability, valuation and institutional ownership.
Volatility and Risk
EZchip Semiconductor has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500. Comparatively, Celestica has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500.
This table compares EZchip Semiconductor and Celestica’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of recent ratings and price targets for EZchip Semiconductor and Celestica, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Celestica has a consensus target price of $13.93, suggesting a potential upside of 38.78%. Given Celestica’s higher probable upside, analysts plainly believe Celestica is more favorable than EZchip Semiconductor.
Insider & Institutional Ownership
59.6% of Celestica shares are owned by institutional investors. 1.0% of Celestica shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares EZchip Semiconductor and Celestica’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Celestica||$6.02 billion||0.21||$136.30 million||$0.78||12.87|
Celestica has higher revenue and earnings than EZchip Semiconductor. EZchip Semiconductor is trading at a lower price-to-earnings ratio than Celestica, indicating that it is currently the more affordable of the two stocks.
Celestica beats EZchip Semiconductor on 8 of the 10 factors compared between the two stocks.
EZchip Semiconductor Company Profile
EZchip Semiconductor Ltd.is a fabless semiconductor company that provides data-path processing solutions for a range of applications for carrier, cloud and data center networks. The Company’s portfolio of solutions includes network processors, multi-core processors, network adapters and appliances with a software ecosystem. It designs and sells network processors for networking equipment, integrating several key functions into a single chip. Networking equipment vendors use the Company’s network processors to form the silicon core of networking equipment, such as switches and routers, for voice, video and data integration in a variety of applications. The Company’s network processors are single-chip solutions that enable its customers to design multi-port line cards. Its multi-core processors allow customers to design systems that are high performance, as well as power efficient. The Company’s subsidiaries include EZchip Technologies Ltd., EZchip Inc. and EZchip Semiconductor Inc.
Celestica Company Profile
Celestica Inc. is a provider of supply chain solutions. The Company operates in electronics manufacturing services business segment. The Company offers a range of services to its customers, including design and development, engineering services, supply chain management, new product introduction, component sourcing, electronics manufacturing, assembly and test, complex mechanical assembly, systems integration, precision machining, order fulfillment, logistics and after-market repair and return services. Its products and services serve a range of applications, including servers; storage systems; optical equipment; aerospace and defense electronics; healthcare products and applications; semiconductor equipment, and a range of industrial and alternative energy products, including solar panels and inverters. It designs, manufactures and tests solar panels for the residential, commercial and utility scale markets. It uses technologies in the assembly and testing of its products.
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