Head-To-Head Review: Sumco (OTCMKTS:SUOPY) vs. Himax Technologies (NASDAQ:HIMX)

Himax Technologies (NASDAQ:HIMX) and Sumco (OTCMKTS:SUOPY) are both mid-cap 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, institutional ownership, valuation, profitability, earnings and dividends.

Volatility and Risk

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

Analyst Ratings

This is a summary of current recommendations for Himax Technologies and Sumco, as provided by MarketBeat.com.

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

Himax Technologies currently has a consensus target price of $15.00, suggesting a potential upside of 27.12%. Given Himax Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe Himax Technologies is more favorable than Sumco.

Insider & Institutional Ownership

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

Dividends

Himax Technologies pays an annual dividend of $0.28 per share and has a dividend yield of 2.4%. Sumco pays an annual dividend of $0.29 per share and has a dividend yield of 1.9%. Himax Technologies pays out 63.6% of its earnings in the form of a dividend. Sumco pays out 36.3% 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.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Himax Technologies	$945.43 million	2.18	$50.62 million	$0.44	26.82
Sumco	$3.04 billion	0.87	$453.58 million	$0.80	18.86

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.

Profitability

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

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

Summary

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

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.

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.