Head to Head Analysis: Sumco (OTCMKTS:SUOPY) vs. Himax Technologies (NASDAQ:HIMX)

Sumco (OTCMKTS:SUOPY) and Himax Technologies (NASDAQ:HIMX) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, valuation, profitability and institutional ownership.

Insider and Institutional Ownership

0.0% of Sumco shares are held by institutional investors. Comparatively, 69.8% of Himax Technologies shares are held by institutional investors. 31.5% of Himax Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Sumco and Himax Technologies, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sumco	0	0	0	0	0.00
Himax Technologies	0	0	1	0	3.00

Himax Technologies has a consensus target price of $15.00, suggesting a potential upside of 16.73%. Given Himax Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe Himax Technologies is more favorable than Sumco.

Dividends

Sumco pays an annual dividend of $0.29 per share and has a dividend yield of 1.9%. Himax Technologies pays an annual dividend of $0.28 per share and has a dividend yield of 2.2%. Sumco pays out 36.3% of its earnings in the form of a dividend. Himax Technologies pays out 63.6% 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.

Profitability

This table compares Sumco and Himax Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sumco	5.25%	3.25%	1.83%
Himax Technologies	8.77%	9.06%	4.78%

Valuation and Earnings

This table compares Sumco and Himax Technologies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sumco	$3.04 billion	0.89	$453.58 million	$0.80	19.36
Himax Technologies	$945.43 million	2.37	$50.62 million	$0.44	29.21

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

Risk & Volatility

Sumco has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500. Comparatively, Himax Technologies has a beta of 1.94, suggesting that its stock price is 94% more volatile than the S&P 500.

Summary

Himax Technologies beats Sumco on 12 of the 16 factors compared between the two stocks.

About Sumco

Sumco Corporation manufactures and sells silicon wafers for the semiconductor industry in Japan, the United States, China, Taiwan, Korea, and internationally. It provides monocrystalline ingots, as well as polished, annealed, epitaxial, junction isolated, silicon-on-insulator, and reclaimed polished wafers. The company was formerly known as Sumitomo Mitsubishi Silicon Corp. and changed its name to Sumco Corporation in August 2005. Sumco Corporation was incorporated in 1999 and is headquartered in Tokyo, Japan.

About Himax Technologies

Himax Technologies, Inc., a fabless semiconductor company, provides display imaging processing technologies in China, Taiwan, the Philippines, Korea, Japan, Europe, and the United States. The company operates in two segments, Driver IC and Non-Driver Products. It offers display driver integrated circuits (ICs) and timing controllers that are used in televisions, PC monitors, laptops, mobile phones, tablets, automotive, ePaper devices, industrial displays, and other products. The company also provides automotive IC solutions, including traditional driver ICs; advanced in-cell touch and display driver integration; large touch and display driver integration; and local dimming timing controllers, as well as active matrix organic light-emitting diode (AMOLED) solutions, including AMOLED drivers, timing controllers, and touch controller ICs. In addition, it offers application specific IC services; liquid crystal on silicon and micro-electro mechanical system products; Power ICs; complementary metal oxide semiconductor image sensor products; wafer level optics products; 3D sensing products; and ultralow power WiseEye smart image sensing products. The company markets its display drivers to panel manufacturers, mobile device module manufacturers, and manufacturers of end-use products. Himax Technologies, Inc. was incorporated in 2001 and is headquartered in Tainan City, Taiwan.