Cypress Semiconductor Corporation (CY) & Monolithic Power Systems (MPWR) Critical Review
Cypress Semiconductor Corporation (NASDAQ: CY) and Monolithic Power Systems (NASDAQ:MPWR) are both mid-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, dividends, risk, analyst recommendations and institutional ownership.
This table compares Cypress Semiconductor Corporation and Monolithic Power Systems’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cypress Semiconductor Corporation||-6.04%||6.27%||3.10%|
|Monolithic Power Systems||14.30%||14.10%||11.84%|
Earnings and Valuation
This table compares Cypress Semiconductor Corporation and Monolithic Power Systems’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Cypress Semiconductor Corporation||$2.18 billion||2.35||$232.52 million||($0.40)||-38.52|
|Monolithic Power Systems||$422.63 million||10.55||$80.16 million||$1.41||76.40|
Cypress Semiconductor Corporation has higher revenue and earnings than Monolithic Power Systems. Cypress Semiconductor Corporation is trading at a lower price-to-earnings ratio than Monolithic Power Systems, indicating that it is currently the more affordable of the two stocks.
Cypress Semiconductor Corporation pays an annual dividend of $0.44 per share and has a dividend yield of 2.9%. Monolithic Power Systems pays an annual dividend of $0.80 per share and has a dividend yield of 0.7%. Cypress Semiconductor Corporation pays out -110.0% of its earnings in the form of a dividend. Monolithic Power Systems pays out 56.7% 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. Cypress Semiconductor Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.
Volatility and Risk
Cypress Semiconductor Corporation has a beta of 2.04, suggesting that its stock price is 104% more volatile than the S&P 500. Comparatively, Monolithic Power Systems has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.
Insider & Institutional Ownership
97.1% of Cypress Semiconductor Corporation shares are owned by institutional investors. Comparatively, 93.2% of Monolithic Power Systems shares are owned by institutional investors. 0.7% of Cypress Semiconductor Corporation shares are owned by company insiders. Comparatively, 4.0% of Monolithic Power Systems shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent recommendations and price targets for Cypress Semiconductor Corporation and Monolithic Power Systems, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cypress Semiconductor Corporation||1||1||10||0||2.75|
|Monolithic Power Systems||0||0||7||1||3.13|
Cypress Semiconductor Corporation presently has a consensus target price of $16.91, suggesting a potential upside of 9.73%. Monolithic Power Systems has a consensus target price of $114.14, suggesting a potential upside of 5.96%. Given Cypress Semiconductor Corporation’s higher possible upside, equities analysts clearly believe Cypress Semiconductor Corporation is more favorable than Monolithic Power Systems.
Monolithic Power Systems beats Cypress Semiconductor Corporation on 9 of the 17 factors compared between the two stocks.
About Cypress Semiconductor Corporation
Cypress Semiconductor Corporation manufactures embedded system solutions for automotive, industrial, home automation and appliances, consumer electronics and medical products. The Company’s segments include Microcontroller and Connectivity Division (MCD), and Memory Products Division (MPD). MCD focuses on microcontroller (MCU), analog and wireless and wired connectivity solutions. MPD focuses on parallel and serial NOR flash memories, NAND flash memories, static random access memory (SRAM), ferroelectric-random access memory (F-RAM) ferroelectric memory devices and other specialty memories. The Company’s products include Traveo MCUs and Flexible MCUs; PSoC 1, PSoC 3, PSoC 4 and PSoC 5LP; CapSense, and TrueTouch Analog Power Management integrated circuits (PMICs) and energy harvesting solutions.
About Monolithic Power Systems
Monolithic Power Systems, Inc. designs, develops and markets integrated power semiconductor solutions and power delivery architectures. The Company operates in the design, development, marketing and sale of power solutions for the communications, storage and computing, consumer and industrial markets segment. The Company’s product families include Direct Current (DC) to DC Products, and Lighting Control Products. The Company’s DC to DC integrated circuits (ICs) are used to convert and control voltages within a range of electronic systems, such as portable electronic devices, wireless local area network (LAN) access points, computers, monitors, automobiles and medical equipment. Lighting control ICs are used in backlighting and general illumination products. In addition to Alternating Current (AC)/DC offline solutions for lighting illumination applications, the Company also offers AC/DC power conversion solutions for end products that plug into a wall outlet.
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