Amkor Technology (NASDAQ: AMKR) and Xcerra Corporation (NASDAQ:XCRA) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, risk, dividends, earnings and profitability.

Earnings and Valuation

This table compares Amkor Technology and Xcerra Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Amkor Technology $4.01 billion 0.51 $866.26 million $1.11 7.69
Xcerra Corporation $355.08 million 1.46 $23.08 million $0.32 29.88

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

Volatility & Risk

Amkor Technology has a beta of 2.52, indicating that its stock price is 152% more volatile than the S&P 500. Comparatively, Xcerra Corporation has a beta of 1.59, indicating that its stock price is 59% more volatile than the S&P 500.

Profitability

This table compares Amkor Technology and Xcerra Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amkor Technology 6.63% 12.95% 4.35%
Xcerra Corporation 4.86% 6.63% 4.96%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Amkor Technology and Xcerra Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amkor Technology 0 1 0 0 2.00
Xcerra Corporation 0 5 0 0 2.00

Amkor Technology presently has a consensus target price of $10.50, indicating a potential upside of 22.95%. Xcerra Corporation has a consensus target price of $10.25, indicating a potential upside of 7.22%. Given Amkor Technology’s higher probable upside, analysts plainly believe Amkor Technology is more favorable than Xcerra Corporation.

Insider and Institutional Ownership

38.7% of Amkor Technology shares are owned by institutional investors. Comparatively, 79.0% of Xcerra Corporation shares are owned by institutional investors. 58.1% of Amkor Technology shares are owned by insiders. Comparatively, 2.6% of Xcerra Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Amkor Technology beats Xcerra Corporation on 8 of the 12 factors compared between the two stocks.

About Amkor Technology

Amkor Technology, Inc. is a provider of outsourced semiconductor packaging and test services. The Company’s packaging and test services are designed to meet application and chip specific requirements, including the type of interconnect technology; size, thickness and electrical, and mechanical and thermal performance. It provides packaging and test services, including semiconductor wafer bump, wafer probe, wafer backgrind, package design, packaging, system-level, and final test and drop shipment services. The Company provides its services to integrated device manufacturers (IDMs), fabless semiconductor companies and contract foundries. IDMs design, manufacture, package and test semiconductors in their own facilities. The Company offers a range of advanced and mainstream packaging and test services. The Company’s mainstream packages include leadframe packages, substrate-based wirebond packages and micro-electro-mechanical systems packages.

About Xcerra Corporation

Xcerra Corporation is a provider of test and handling capital equipment, interface products, test fixtures and related services to the semiconductor and electronics manufacturing industries. The Company operates through six segments: Semiconductor Test, Semiconductor Handlers, Contactors, PCB Test, Probes/Pins and Fixtures. The Semiconductor Test segment includes operations related to the design, manufacture and sale of automated test equipment for the semiconductor industry that is used to test system-on-a-chip, digital, analog and mixed signal integrated circuits. The Semiconductor Handlers segment includes operations related to the design, manufacture and sale of test handlers used in the testing of integrated circuits. The Contactors segment includes operations related to the design, manufacture and sale of test contactors. The PCB test segment includes operations related to design, manufacture and sale of equipment used in the testing of bare and loaded printed circuit boards.

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