Financial Analysis: Deswell Industries (NASDAQ:DSWL) versus Microvision (NASDAQ:MVIS)

Microvision (NASDAQ:MVIS) and Deswell Industries (NASDAQ:DSWL) are both small-cap technology companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, dividends, valuation and risk.

Profitability

This table compares Microvision and Deswell Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Microvision	-2,230.59%	-324.21%	-114.29%
Deswell Industries	N/A	N/A	N/A

Earnings & Valuation

This table compares Microvision and Deswell Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Microvision	$1.21 million	33.35	-$94.98 million	($5.11)	-0.23
Deswell Industries	$61.33 million	0.81	$10.63 million	$0.48	6.55

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

Risk & Volatility

Microvision has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500. Comparatively, Deswell Industries has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500.

Institutional and Insider Ownership

30.9% of Microvision shares are held by institutional investors. 1.2% of Microvision shares are held by company insiders. Comparatively, 39.0% of Deswell Industries shares are held by company 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.

Analyst Ratings

This is a summary of current ratings and recommmendations for Microvision and Deswell Industries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Microvision	1	1	0	0	1.50
Deswell Industries	0	1	0	0	2.00

Microvision currently has a consensus price target of $45.00, indicating a potential upside of 3,697.47%. Given Microvision’s higher possible upside, equities analysts clearly believe Microvision is more favorable than Deswell Industries.

Summary

Deswell Industries beats Microvision on 9 of the 13 factors compared between the two stocks.

About Microvision

MicroVision, Inc. develops lidar sensing and perception technologies for automotive and industrial applications. Its products are designed to help vehicles and machines detect, classify and track objects and understand their surroundings, supporting advanced driver-assistance systems and autonomous driving. The company’s technology uses microelectromechanical systems (MEMS), laser scanning and related software to provide real-time environmental data. MicroVision’s product portfolio includes automotive lidar systems such as MAVIN, a long-range sensor platform, and MOVIA, a compact lidar product intended for applications including vehicle automation and industrial sensing.

About Deswell Industries

Deswell Industries, Inc. (NASDAQ: DSWL) is a manufacturer of plastic and electronic components for original equipment manufacturers and other industrial customers. The company’s primary activities include injection molding, plastic extrusion, and the assembly of electronic products. Its plastic manufacturing operations produce molded and extruded parts used in products such as consumer electronics, electrical appliances, automotive equipment, and other commercial and industrial applications. Deswell also provides related services, including tooling and mold fabrication, product assembly, and manufacturing support for customer-designed components.