AXT (NASDAQ: AXTI) and Himax Technologies (NASDAQ:HIMX) are both small-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Insider and Institutional Ownership

60.4% of AXT shares are owned by institutional investors. Comparatively, 26.9% of Himax Technologies shares are owned by institutional investors. 6.9% of AXT shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares AXT and Himax Technologies’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AXT $81.35 million 4.14 $5.63 million $0.24 36.04
Himax Technologies $802.92 million 2.12 $50.91 million $0.06 164.67

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

Risk and Volatility

AXT has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500. Comparatively, Himax Technologies has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500.

Profitability

This table compares AXT and Himax Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AXT 9.96% 5.67% 5.04%
Himax Technologies 1.25% 2.10% 1.24%

Dividends

Himax Technologies pays an annual dividend of $0.23 per share and has a dividend yield of 2.3%. AXT does not pay a dividend. Himax Technologies pays out 383.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for AXT and Himax Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AXT 0 1 3 0 2.75
Himax Technologies 3 3 9 0 2.40

AXT currently has a consensus price target of $9.94, indicating a potential upside of 14.88%. Himax Technologies has a consensus price target of $9.86, indicating a potential downside of 0.19%. Given AXT’s stronger consensus rating and higher possible upside, equities research analysts plainly believe AXT is more favorable than Himax Technologies.

Summary

AXT beats Himax Technologies on 11 of the 16 factors compared between the two stocks.

About AXT

AXT, Inc. (AXT) is a developer and producer of compound and single element semiconductor substrates, also known as wafers. The dominant substrates used in producing semiconductor chips and other electronic circuits are made from silicon. The Company is engaged in the design, development, manufacture and distribution of compound semiconductor substrates and sale of materials. The Company provides alternative or specialty materials in the form of substrates or wafers, including compound and single element substrates. Its compound substrates combine indium with phosphorous (InP) or gallium with arsenic (GaAs). Its single element substrates are made from germanium (Ge). The Company uses its Vertical Gradient Freeze (VGF) technique for growing single crystal Indium Phosphide (InP), Gallium Arsenide (GaAs) and Germanium (Ge) ingots used to produce wafers for diverse electronic and optoelectronic device and circuit applications.

About Himax Technologies

Himax Technologies, Inc. is a fabless semiconductor solution provider. The Company is engaged in display driver integrated circuits (IC) and timing controllers used in televisions, laptops, monitors, mobile phones, tablets, digital cameras, car navigation and other consumer electronics devices. The Company operates through two segments: Driver IC and Non-driver products. In addition, the Company designs and provides controllers for touch sensor displays, liquid crystal on silicon micro-displays used in palm-size projectors and head-mounted displays, light-emitting diode driver ICs, power management ICs, scaler products for monitors and projectors, video processing IC solutions and silicon IPs. It also offers digital camera solutions, including complementary metal-oxide-semiconductor image sensors and wafer level optics, which are used in a range of applications, such as mobile phone, tablet, laptop, televisions, personal computer camera, automobile, security and medical devices.

Receive News & Ratings for AXT Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for AXT and related companies with MarketBeat.com's FREE daily email newsletter.