Texas Instruments (NASDAQ: HIMX) and Himax Technologies (NASDAQ:HIMX) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, risk, profitability and valuation.

Volatility & Risk

Texas Instruments has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500. Comparatively, Himax Technologies has a beta of -0.25, meaning that its stock price is 125% less volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Texas Instruments 28.08% 46.80% 28.24%
Himax Technologies 3.66% 6.12% 3.45%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Texas Instruments and Himax Technologies, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Texas Instruments 1 11 14 0 2.50
Himax Technologies 1 7 4 0 2.25

Texas Instruments currently has a consensus price target of $121.29, suggesting a potential upside of 15.12%. Himax Technologies has a consensus price target of $10.10, suggesting a potential upside of 64.50%. Given Himax Technologies’ higher possible upside, analysts plainly believe Himax Technologies is more favorable than Texas Instruments.

Dividends

Texas Instruments pays an annual dividend of $2.48 per share and has a dividend yield of 2.4%. Himax Technologies pays an annual dividend of $0.09 per share and has a dividend yield of 1.5%. Texas Instruments pays out 57.9% of its earnings in the form of a dividend. Himax Technologies pays out 56.3% 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. Texas Instruments has increased its dividend for 14 consecutive years. Texas Instruments is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Texas Instruments and Himax Technologies’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Texas Instruments $14.96 billion 6.85 $3.68 billion $4.28 24.62
Himax Technologies $685.17 million 1.54 $27.96 million $0.16 38.38

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

Insider and Institutional Ownership

84.4% of Texas Instruments shares are held by institutional investors. Comparatively, 23.4% of Himax Technologies shares are held by institutional investors. 0.8% of Texas Instruments shares are held by insiders. Comparatively, 31.5% of Himax Technologies shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Texas Instruments beats Himax Technologies on 13 of the 17 factors compared between the two stocks.

Texas Instruments Company Profile

Texas Instruments Incorporated designs, manufactures, and sells semiconductors to electronics designers and manufacturers worldwide. It operates in two segments, Analog and Embedded Processing. The Analog segment offers power products to manage power requirements in various levels using battery management solutions, portable components, power supply controls, point-of-load products, switches and interfaces, integrated protection devices, high-voltage products, and mobile lighting and display products. This segment also provides signal chain products that sense, condition, and measure signals to allow information to be transferred or converted for further processing and control for use in amplifier, data converter, interface product, motor drive, clock, and sensing product end-markets; and integrated analog and standard products, which are primarily for sale into personal electronics, industrial, and automotive markets. The Embedded Processing segment offers connected microcontrollers, such as microcontrollers, microcontrollers with integrated wireless capabilities, and stand-alone wireless connectivity solutions that are used in electronic equipment to sense, connect, log, and transfer data; and digital signal and applications processors for mathematical computations and specific computing activity. This segment offers products for use in various markets, principally industrial and automotive. The company also provides DLP products, primarily for use in projectors to create high-definition images; calculators; and application-specific integrated circuits. Texas Instruments Incorporated markets and sells its semiconductor products through direct sales and distributors, as well as online. The company was founded in 1930 and is headquartered in Dallas, Texas.

Himax Technologies Company Profile

Himax Technologies, Inc., a fabless semiconductor company, provides display imaging processing technologies worldwide. The company operates in two segments, Driver IC and Non-Driver Products. It offers display driver integrated circuits (ICs) and timing controllers used in televisions (TVs), laptops, monitors, mobile phones, tablets, digital cameras, car navigation, and other consumer electronics devices. The company also designs and provides controllers for touch sensor displays; in-cell touch and display driver integration single-chip solutions; LED driver and power management ICs; scaler products for monitors and projectors; tailor-made video processing IC solutions; silicon IPs; and liquid crystal on silicon micro-displays for augmented reality (AR) devices and head-up displays for automotive industry. In addition, it offers digital camera solutions, including complementary metal oxide semiconductor image sensors and wafer level optics for AR devices, 3D sensing, and machine vision, which are used in various applications, such as mobile phone, tablet, laptop, TV, PC camera, automobile, security, medical devices, and Internet on Things. The company markets its display drivers and display-related products to panel manufacturers, agents or distributors, module manufacturers, and assembly houses; and non-driver products to camera module manufacturers, optical engine manufacturers, and television system manufacturers. Himax Technologies, Inc. was founded in 2001 and is headquartered in Tainan City, Taiwan.

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