Analyzing Microsemi (MSCC) and Exar (EXAR)

Microsemi (NASDAQ: MSCC) and Exar (NYSE:EXAR) are both technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, risk and profitability.

Valuation & Earnings

This table compares Microsemi and Exar’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Microsemi $1.81 billion 3.89 $176.30 million $1.53 39.22
Exar N/A N/A N/A $0.18 72.17

Microsemi has higher revenue and earnings than Exar. Microsemi is trading at a lower price-to-earnings ratio than Exar, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations for Microsemi and Exar, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Microsemi 0 2 11 0 2.85
Exar 0 2 0 0 2.00

Microsemi presently has a consensus target price of $66.60, suggesting a potential upside of 10.98%. Exar has a consensus target price of $13.00, suggesting a potential upside of 0.08%. Given Microsemi’s stronger consensus rating and higher probable upside, equities analysts plainly believe Microsemi is more favorable than Exar.

Profitability

This table compares Microsemi and Exar’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Microsemi 11.10% 21.50% 9.55%
Exar 6.30% 2.37% 2.13%

Insider and Institutional Ownership

99.9% of Microsemi shares are owned by institutional investors. Comparatively, 78.8% of Exar shares are owned by institutional investors. 0.5% of Microsemi shares are owned by insiders. Comparatively, 2.5% of Exar shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Microsemi has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, Exar has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500.

Summary

Microsemi beats Exar on 9 of the 12 factors compared between the two stocks.

Microsemi Company Profile

Microsemi Corporation is a designer, manufacturer and marketer of analog and mixed-signal semiconductor solutions differentiated by power, security, reliability and performance. The Company offers a portfolio of semiconductor and system solutions for aerospace and defense, communications, data center and industrial markets. Its products include high-performance and radiation-hardened analog mixed-signal integrated circuits (ICs), field programmable gate arrays (FPGAs), system on chip solutions (SoCs) and application-specific integrated circuits (ASICs) and power management products. The Company’s marketed products include Switchtec PFX PCIe switch, Flashtec NVM Express (NVMe)2032 and NVMe2016 controllers, Flashtec NVM Express (NVMe)2108 eight channel and NVMe2104 four channel controllers, PDS-EM-8100 PoE 2.5 gigabits per second (Gbps) Multiplexer, Chip Scale Atomic Clock (CSAC) components and miTimePLL.

Exar Company Profile

Exar Corporation (Exar) designs, develops and markets analog mixed-signal integrated circuits (ICs) and sub-system solutions. The Company’s products are deployed in a range of applications, such as industrial, instrumentation and medical equipment, networking and telecommunication systems, servers, enterprise storage systems, flat panel displays, light emitting diode (LED) lighting solutions, set top boxes and digital video recorders. Exar’s product portfolio includes connectivity, power management, high performance analog, communications, processors, flat panel display and LED lighting. The Company designs and develops amplifiers and data converters that support a range of signal path and conditioning needs of networking, industrial control and embedded applications. The Company markets its products to three primary markets, such as industrial and embedded systems, consumer and infrastructure.

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