Siliconware Precision Industries (NASDAQ: SPIL) and United Microelectronics Corporation (NYSE:UMC) are both mid-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, risk, earnings, analyst recommendations, institutional ownership and valuation.
Valuation and Earnings
This table compares Siliconware Precision Industries and United Microelectronics Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Siliconware Precision Industries||$2.79 billion||1.76||$770.24 million||$0.34||23.24|
|United Microelectronics Corporation||$5.02 billion||1.27||$1.89 billion||$0.13||20.08|
United Microelectronics Corporation has higher revenue and earnings than Siliconware Precision Industries. United Microelectronics Corporation is trading at a lower price-to-earnings ratio than Siliconware Precision Industries, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
2.9% of Siliconware Precision Industries shares are held by institutional investors. Comparatively, 5.4% of United Microelectronics Corporation shares are held by institutional investors. 14.3% of Siliconware Precision Industries shares are held by company insiders. Comparatively, 8.0% of United Microelectronics Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
This table compares Siliconware Precision Industries and United Microelectronics Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Siliconware Precision Industries||10.29%||13.18%||7.01%|
|United Microelectronics Corporation||6.52%||4.58%||2.60%|
This is a breakdown of current ratings and recommmendations for Siliconware Precision Industries and United Microelectronics Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Siliconware Precision Industries||0||0||0||0||N/A|
|United Microelectronics Corporation||8||1||0||0||1.11|
United Microelectronics Corporation has a consensus target price of $2.10, indicating a potential downside of 19.54%. Given United Microelectronics Corporation’s higher possible upside, analysts plainly believe United Microelectronics Corporation is more favorable than Siliconware Precision Industries.
Siliconware Precision Industries pays an annual dividend of $0.21 per share and has a dividend yield of 2.7%. United Microelectronics Corporation pays an annual dividend of $0.06 per share and has a dividend yield of 2.3%. Siliconware Precision Industries pays out 61.8% of its earnings in the form of a dividend. United Microelectronics Corporation pays out 46.2% 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.
Volatility and Risk
Siliconware Precision Industries has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500. Comparatively, United Microelectronics Corporation has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500.
Siliconware Precision Industries beats United Microelectronics Corporation on 8 of the 14 factors compared between the two stocks.
Siliconware Precision Industries Company Profile
Siliconware Precision Industries Co., Ltd. is a Taiwan-based company mainly engaged in the provision of packaging and testing services of integrated circuits (ICs) and related products. The Company’s businesses include the manufacture, processing, assembly, testing and importing and exporting of ICs, transistors, light emitting diode (LED) digital displays, LED lights, liquid crystal display (LCD) clock cores, phototransistors, synthesis circuits, as well as thin film circuits and thick film circuits. The Company’s packaging businesses focus on IC products, including plastic small size ICs and plastic square planar ICs, among others. Its testing businesses mainly include final testing businesses and system level testing businesses, among others.
United Microelectronics Corporation Company Profile
United Microelectronics Corporation is a global semiconductor foundry. The Company provides integrated circuit (IC) production for applications spanning every sector of the electronics industry. The Company operates through two segments: wafer fabrication and new business. The primary operating activity of the Company’s wafer fabrication segment is the manufacture of chips to the design specifications of its customers by using its own processes and techniques. The new business segment primarily includes researching, developing, manufacturing, and providing solar energy and new generation light-emitting diode (LED). The Company maintains a customer base across various industries, including communication, consumer electronics, computer, memory and others, while focusing on manufacturing for applications, including networking, telecommunications, Internet, multimedia, personal computers (PCs) and graphics.
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