Rubicon Technology (NASDAQ: RBCN) and Microsemi (NASDAQ:MSCC) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.

Insider & Institutional Ownership

32.2% of Rubicon Technology shares are held by institutional investors. Comparatively, 97.3% of Microsemi shares are held by institutional investors. 12.1% of Rubicon Technology shares are held by insiders. Comparatively, 0.6% of Microsemi shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and target prices for Rubicon Technology and Microsemi, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rubicon Technology 0 0 0 0 N/A
Microsemi 0 2 10 0 2.83

Microsemi has a consensus target price of $61.67, suggesting a potential upside of 18.16%. Given Microsemi’s higher probable upside, analysts clearly believe Microsemi is more favorable than Rubicon Technology.

Volatility & Risk

Rubicon Technology has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500. Comparatively, Microsemi has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500.

Valuation & Earnings

This table compares Rubicon Technology and Microsemi’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rubicon Technology $19.63 million 1.11 -$62.87 million ($12.97) -0.62
Microsemi $1.81 billion 3.38 $176.30 million $1.50 34.79

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

Profitability

This table compares Rubicon Technology and Microsemi’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rubicon Technology -409.18% -78.15% -74.16%
Microsemi 9.73% 20.82% 8.94%

Summary

Microsemi beats Rubicon Technology on 12 of the 13 factors compared between the two stocks.

Rubicon Technology Company Profile

Rubicon Technology, Inc. is a vertically integrated, electronic materials provider specializing in monocrystalline sapphire for applications in light-emitting diodes (LEDs), optical systems and specialty electronic devices. The Company’s product lines include sapphire cores; four and six-inch sapphire wafers; four, six, and eight-inch patterned sapphire substrate (PSS) wafers, and optical sapphire components. Its sapphire is also used as an exterior component in mobile devices, specifically camera lens covers, dual flashes and home buttons on certain newer model smartphones and as the crystal covering the faces of certain smart watches. In addition, some consumer electronics original equipment manufacturers (OEMs) use sapphire faceplates for smartphones. For the LED market, it sells 2 to 6-inch material in core form and four, six and eight-inch material in polished and PSS wafer form. Its principal customers are semiconductor device manufacturers and wafer polishing companies.

Microsemi Company Profile

Microsemi Corporation is a designer, manufacturer and marketer of analog and mixed-signal semiconductor solutions differentiated by power, security, reliability and performance. The Company offers a portfolio of semiconductor and system solutions for aerospace and defense, communications, data center and industrial markets. Its products include high-performance and radiation-hardened analog mixed-signal integrated circuits (ICs), field programmable gate arrays (FPGAs), system on chip solutions (SoCs) and application-specific integrated circuits (ASICs) and power management products. The Company’s marketed products include Switchtec PFX PCIe switch, Flashtec NVM Express (NVMe)2032 and NVMe2016 controllers, Flashtec NVM Express (NVMe)2108 eight channel and NVMe2104 four channel controllers, PDS-EM-8100 PoE 2.5 gigabits per second (Gbps) Multiplexer, Chip Scale Atomic Clock (CSAC) components and miTimePLL.

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