Semtech (NASDAQ:SMTC – Get Free Report) and SkyWater Technology (NASDAQ:SKYT – Get Free Report) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, analyst recommendations, risk, valuation, institutional ownership and earnings.
Insider & Institutional Ownership
70.0% of SkyWater Technology shares are owned by institutional investors. 0.6% of Semtech shares are owned by insiders. Comparatively, 42.6% of SkyWater Technology shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Volatility & Risk
Semtech has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500. Comparatively, SkyWater Technology has a beta of 3.94, suggesting that its share price is 294% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Semtech | 0 | 1 | 11 | 0 | 2.92 |
| SkyWater Technology | 0 | 0 | 4 | 0 | 3.00 |
Semtech currently has a consensus price target of $48.90, suggesting a potential upside of 48.09%. SkyWater Technology has a consensus price target of $13.25, suggesting a potential upside of 73.20%. Given SkyWater Technology’s stronger consensus rating and higher possible upside, analysts clearly believe SkyWater Technology is more favorable than Semtech.
Earnings & Valuation
This table compares Semtech and SkyWater Technology’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Semtech | $868.76 million | 2.46 | -$1.09 billion | ($16.91) | -1.95 |
| SkyWater Technology | $286.68 million | 1.26 | -$30.76 million | ($0.69) | -11.09 |
SkyWater Technology has lower revenue, but higher earnings than Semtech. SkyWater Technology is trading at a lower price-to-earnings ratio than Semtech, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Semtech and SkyWater Technology’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Semtech | -129.52% | -154.99% | -1.82% |
| SkyWater Technology | -10.73% | -32.59% | -6.66% |
Summary
SkyWater Technology beats Semtech on 9 of the 13 factors compared between the two stocks.
About Semtech
Semtech Corporation designs, develops, manufactures, and markets analog and mixed-signal semiconductor and advanced algorithms. It provides signal integrity products, including a portfolio of optical data communications and video transport products used in various infrastructure, and industrial applications; a portfolio of integrated circuits for data centers, enterprise networks, passive optical networks, wireless base station optical transceivers, and high-speed interface applications; and video products for broadcast applications, as well as video-over-IP technology for professional audio video applications. The company offers protection products, such as filter and termination devices that are integrated with the transient voltage suppressor devices, which protect electronic systems from voltage spikes; and sensing products comprising a portfolio of specialized radio frequency products used in various industrial, medical, and communications applications, as well as specialized sensing products. In addition, it provides switching voltage regulators, combination switching and linear regulators, smart regulators, isolated switches, and wireless charging related products. Further, it offers portfolio of IoT solutions, such as modules, gateways, routers, and connected services; and portfolio of connected services, including wireless connectivity and cloud-based services for industrial, medical and communications applications. The company serves original equipment manufacturers and industrial end-markets. It sells its products directly, as well as through independent sales representative firms and independent distributors in Asia- Pacific, North America, and Europe. Semtech Corporation was incorporated in 1960 and is headquartered in Camarillo, California.
About SkyWater Technology
SkyWater Technology, Inc., together with its subsidiaries, operates as a pure-play technology foundry that engages in the provision of semiconductor development, manufacturing, and packaging services in the United States. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, micro-electromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive, bio-health, consumer, and industrial sectors. The company was incorporated in 2016 and is headquartered in Bloomington, Minnesota.
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