Monolithic Power Systems (NASDAQ:MPWR) vs. TOKYO ELECTRON/ADR (NASDAQ:TOELY) Head to Head Comparison

TOKYO ELECTRON/ADR (OTCMKTS:TOELY) and Monolithic Power Systems (NASDAQ:MPWR) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.

Volatility and Risk

TOKYO ELECTRON/ADR has a beta of 1.51, suggesting that its stock price is 51% more volatile than the S&P 500. Comparatively, Monolithic Power Systems has a beta of 1.68, suggesting that its stock price is 68% more volatile than the S&P 500.

Dividends

TOKYO ELECTRON/ADR pays an annual dividend of $1.23 per share and has a dividend yield of 3.2%. Monolithic Power Systems pays an annual dividend of $1.60 per share and has a dividend yield of 1.1%. TOKYO ELECTRON/ADR pays out 42.7% of its earnings in the form of a dividend. Monolithic Power Systems pays out 66.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Monolithic Power Systems has raised its dividend for 4 consecutive years. TOKYO ELECTRON/ADR is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares TOKYO ELECTRON/ADR and Monolithic Power Systems’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TOKYO ELECTRON/ADR $10.21 billion 2.47 $1.92 billion $2.88 13.38
Monolithic Power Systems $582.38 million 10.60 $105.27 million $2.39 59.97

TOKYO ELECTRON/ADR has higher revenue and earnings than Monolithic Power Systems. TOKYO ELECTRON/ADR is trading at a lower price-to-earnings ratio than Monolithic Power Systems, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

96.0% of Monolithic Power Systems shares are held by institutional investors. 3.0% of Monolithic Power Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares TOKYO ELECTRON/ADR and Monolithic Power Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TOKYO ELECTRON/ADR 19.56% 33.09% 21.34%
Monolithic Power Systems 18.43% 17.99% 14.44%

Analyst Recommendations

This is a summary of current recommendations and price targets for TOKYO ELECTRON/ADR and Monolithic Power Systems, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TOKYO ELECTRON/ADR 0 1 0 0 2.00
Monolithic Power Systems 0 1 5 0 2.83

Monolithic Power Systems has a consensus target price of $151.29, indicating a potential upside of 5.56%. Given Monolithic Power Systems’ stronger consensus rating and higher probable upside, analysts plainly believe Monolithic Power Systems is more favorable than TOKYO ELECTRON/ADR.

Summary

Monolithic Power Systems beats TOKYO ELECTRON/ADR on 9 of the 17 factors compared between the two stocks.

TOKYO ELECTRON/ADR Company Profile

Tokyo Electron Limited, together with its subsidiaries, develops, manufactures, distributes, and sells semiconductor and flat panel display (FPD) production equipment in Japan, North America, Europe, South Korea, Taiwan, China, and internationally. The company's Semiconductor Production Equipment segment offers coaters/developers, plasma etch systems, and single wafer deposition systems and cleaning systems used in wafer processing; wafer probers used in wafer testing process; and electrochemical deposition systems and wafer bonders/debonders used in packaging processes. Its Flat Panel Display Production Equipment segment provides coaters/developers and plasma etch/ash systems for use in the manufacture of FPDs, as well as inkjet printing systems for manufacturing OLED panels. The company also offers logistic, facility maintenance, and insurance services. Tokyo Electron Limited was founded in 1963 and is headquartered in Tokyo, Japan.

Monolithic Power Systems Company Profile

Monolithic Power Systems, Inc. designs, develops, and markets integrated power semiconductor solutions and power delivery architectures for consumer, computing and storage, industrial, automotive, and communications markets. It offers direct current (DC) to DC integrated circuits (ICs) that are used to convert and control voltages of various electronic systems, such as portable electronic devices, wireless LAN access points, computers, monitors, automobiles, and medical equipment. The company also provides lighting control ICs for backlighting that are used in systems, which provide the light source for LCD panels in notebook computers, monitors, car navigation systems, and televisions, as well as for general illumination applications. The company sells its products through third-party distributors, and resellers, as well as directly to original equipment manufacturers, original design manufacturers, and electronic manufacturing service providers in China, Taiwan, Europe, Korea, Southeast Asia, Japan, the United States, and internationally. Monolithic Power Systems, Inc. was founded in 1997 and is headquartered in Kirkland, Washington.

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