Reviewing SuperCom (NASDAQ:SPCB) and Taiwan Semiconductor Mfg. (NASDAQ:TSM)

SuperCom (NASDAQ:SPCB) and Taiwan Semiconductor Mfg. (NYSE:TSM) are both industrial products companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, dividends, institutional ownership, analyst recommendations, profitability and earnings.

Analyst Ratings

This is a summary of current ratings and recommmendations for SuperCom and Taiwan Semiconductor Mfg., as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SuperCom 0 0 1 0 3.00
Taiwan Semiconductor Mfg. 0 1 2 0 2.67

SuperCom presently has a consensus target price of $3.00, suggesting a potential upside of 172.73%. Taiwan Semiconductor Mfg. has a consensus target price of $50.00, suggesting a potential upside of 14.08%. Given SuperCom’s stronger consensus rating and higher probable upside, equities research analysts plainly believe SuperCom is more favorable than Taiwan Semiconductor Mfg..

Profitability

This table compares SuperCom and Taiwan Semiconductor Mfg.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SuperCom N/A N/A N/A
Taiwan Semiconductor Mfg. 31.42% 19.01% 15.15%

Earnings & Valuation

This table compares SuperCom and Taiwan Semiconductor Mfg.’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SuperCom $33.26 million 0.49 -$6.66 million N/A N/A
Taiwan Semiconductor Mfg. $34.20 billion 6.65 $11.86 billion $2.24 19.57

Taiwan Semiconductor Mfg. has higher revenue and earnings than SuperCom.

Dividends

Taiwan Semiconductor Mfg. pays an annual dividend of $1.02 per share and has a dividend yield of 2.3%. SuperCom does not pay a dividend. Taiwan Semiconductor Mfg. pays out 45.5% of its earnings in the form of a dividend. Taiwan Semiconductor Mfg. has increased its dividend for 4 consecutive years.

Volatility and Risk

SuperCom has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500. Comparatively, Taiwan Semiconductor Mfg. has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500.

Insider and Institutional Ownership

18.3% of SuperCom shares are held by institutional investors. Comparatively, 19.6% of Taiwan Semiconductor Mfg. shares are held by institutional investors. 1.1% of Taiwan Semiconductor Mfg. shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Taiwan Semiconductor Mfg. beats SuperCom on 13 of the 16 factors compared between the two stocks.

About SuperCom

SuperCom Ltd. provides digital identity, Internet of Things and connectivity, and cyber security products and solutions to governments, and private and public organizations worldwide. The company offers MAGNA, a common platform for ID registries, e-passports, biometric visas, automated fingerprint identification systems, digitized driver's licenses, and electronic voter registration and election management. Its PureRF suite is a solution based on radio-frequency identification (RFID) tag technology to identify, locate, track, monitor, count, and protect people and objects. The company's PureRF suite comprises PureRF tags, hands-free long-range RFID asset and Vehicle tags, PureRF readers, PureRF activators, and PureRF initializers. It also provides house arrest monitoring systems, PureTag RF bracelets, PureCom RF base stations, GPS offender tracking systems, PureTrack smartphone device, PureBeacon, PureMonitor offender electronic monitoring software, inmate monitoring systems, DoorGuard tracking station, and personnel tags. In addition, the company offers domestic violence victim protection systems; SuperPay, a mobile payment hybrid suite; and PowaPOS, an integrated design incorporating retail peripherals. Further, it provides Safend's Encryption Suite that protects the organization's sensitive data; and designs solutions for carrier wi-fi, enterprise connectivity, smart city, smart hospitality, connected campuses, and connected events. The company serves healthcare and homecare, security and safety, community public safety, law enforcement, electronic monitoring, livestock monitoring, and building and access automation industries. SuperCom Ltd. sells its systems and products through local representatives, subsidiaries, and distribution channels, as well as independent representatives and resellers. The company was formerly known as Vuance Ltd. and changed its name to SuperCom Ltd. in January 2013. SuperCom Ltd. was founded in 1988 and is based in Herzliya, Israel.

About Taiwan Semiconductor Mfg.

Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, engages in manufacturing, selling, packaging, testing, and computer-aided design of integrated circuits and other semiconductor devices. The company manufactures masks and electronic spare parts; researches, develops, designs, manufactures, sells, packages, and tests color filters; and offers customer and engineering support services. It is also involved in investing activities. The company operates in North America, China, Japan, Asia Pacific, Europe, the Middle East, and Africa. Taiwan Semiconductor Manufacturing Company Limited was founded in 1987 and is headquartered in HsinChu, Taiwan.

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