Financial Comparison: GLOBALFOUNDRIES (NASDAQ:GFS) vs. United Microelectronics (NYSE:UMC)

GLOBALFOUNDRIES (NASDAQ:GFS) and United Microelectronics (NYSE:UMC) are both large-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, dividends, analyst recommendations, risk, institutional ownership, earnings and valuation.

Risk & Volatility

GLOBALFOUNDRIES has a beta of 1.54, meaning that its stock price is 54% more volatile than the S&P 500. Comparatively, United Microelectronics has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.

Institutional and Insider Ownership

5.1% of United Microelectronics shares are held by institutional investors. 8.0% of United Microelectronics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares GLOBALFOUNDRIES and United Microelectronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GLOBALFOUNDRIES	11.82%	7.75%	4.78%
United Microelectronics	23.90%	14.80%	9.41%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for GLOBALFOUNDRIES and United Microelectronics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GLOBALFOUNDRIES	0	7	7	0	2.50
United Microelectronics	0	1	2	0	2.67

GLOBALFOUNDRIES presently has a consensus target price of $57.54, indicating a potential upside of 44.75%. United Microelectronics has a consensus target price of $8.90, indicating a potential upside of 3.85%. Given GLOBALFOUNDRIES’s higher probable upside, research analysts plainly believe GLOBALFOUNDRIES is more favorable than United Microelectronics.

Valuation and Earnings

This table compares GLOBALFOUNDRIES and United Microelectronics”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GLOBALFOUNDRIES	$7.39 billion	2.97	$1.02 billion	$1.62	24.54
United Microelectronics	$7.25 billion	2.96	$1.95 billion	$0.70	12.24

United Microelectronics has lower revenue, but higher earnings than GLOBALFOUNDRIES. United Microelectronics is trading at a lower price-to-earnings ratio than GLOBALFOUNDRIES, indicating that it is currently the more affordable of the two stocks.

About GLOBALFOUNDRIES

GLOBALFOUNDRIES Inc. operates as a semiconductor foundry worldwide. The company manufactures a range of semiconductor devices, including microprocessors, mobile application processors, baseband processors, network processors, radio frequency modems, microcontrollers, and power management units; and offers mainstream wafer fabrication services and technologies. The company was founded in 2009 and is based in Malta, New York.

About United Microelectronics

United Microelectronics Corporation operates as a semiconductor wafer foundry in Taiwan, Singapore, China, Hong Kong, Japan, the United States, Europe, and internationally. The company provides circuit design, mask tooling, wafer fabrication, and assembly and testing services. It serves fabless design companies and integrated device manufacturers. The company was incorporated in 1980 and is headquartered in Hsinchu City, Taiwan.