TranSwitch (OTCMKTS:TXCCQ) and Cypress Semiconductor (NASDAQ:CY) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, profitability, earnings, analyst recommendations and risk.

Insider & Institutional Ownership

80.2% of Cypress Semiconductor shares are owned by institutional investors. 6.3% of TranSwitch shares are owned by insiders. Comparatively, 0.6% of Cypress Semiconductor shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares TranSwitch and Cypress Semiconductor’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TranSwitch N/A N/A N/A N/A N/A
Cypress Semiconductor $2.21 billion 3.90 $40.43 million $0.82 28.05

Cypress Semiconductor has higher revenue and earnings than TranSwitch.

Volatility and Risk

TranSwitch has a beta of -4.62, indicating that its stock price is 562% less volatile than the S&P 500. Comparatively, Cypress Semiconductor has a beta of 1.78, indicating that its stock price is 78% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for TranSwitch and Cypress Semiconductor, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TranSwitch 0 0 0 0 N/A
Cypress Semiconductor 0 9 2 0 2.18

Cypress Semiconductor has a consensus target price of $21.89, indicating a potential downside of 4.83%. Given Cypress Semiconductor’s higher probable upside, analysts plainly believe Cypress Semiconductor is more favorable than TranSwitch.

Profitability

This table compares TranSwitch and Cypress Semiconductor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TranSwitch N/A N/A N/A
Cypress Semiconductor 1.83% 15.83% 9.20%

Summary

Cypress Semiconductor beats TranSwitch on 8 of the 9 factors compared between the two stocks.

TranSwitch Company Profile

TranSwitch Corporation, together with its subsidiaries, designs, develops, and supplies integrated circuit and intellectual property solutions that provide functionality for voice, data, and video communications equipment for the customer premises and network infrastructure markets. The company provides integrated multi-core network processor system-on-a-chip (SoC) solutions for fixed, 3G and 4G mobile, VoIP, and multimedia applications. It offers converged network infrastructure products, including infrastructure VoIP processors for wire-line and wireless carrier equipment; access VoIP processors; and EoS/EoPDH mappers and framers for carriers to transport data traffic over SONET, SDH, and PDH networks. The company also offers broadband customer premises equipment, such as connectivity solutions comprising HDMI, DisplayPort, MHL, HDP, Ethernet IP cores, and MHDP transceivers for consumer electronics, home network equipment, and industrial and automotive applications; and multi-service SoCs for customer premises equipment that support telephone voice, fax, and routing functionality over broadband access networks. TranSwitch Corporation sells its products to public network system original equipment manufacturers (OEMs), WAN and LAN equipment OEMs, Internet-oriented OEMs, and communications test and performance measurement equipment OEMs; and government, universities, and private laboratories. The company offers its products directly in North America, Taiwan, China, Japan, Korea, and Europe, as well as through a network of distributors in North America, Asia, and Europe. TranSwitch Corporation was founded in 1988 and is headquartered in Shelton, Connecticut. On November 21, 2013, TranSwitch Corporation filed a voluntary petition for liquidation under Chapter 7 in the U.S. Bankruptcy Court for the District of Connecticut.

Cypress Semiconductor Company Profile

Cypress Semiconductor Corporation designs, develops, manufactures, markets, and sells embedded system solutions worldwide. It operates in two segments, Microcontroller and Connectivity Division, and Memory Products Division. The Microcontroller and Connectivity Division provides microcontroller (MCU), analog, and wireless and wired connectivity solutions, including Traveo automotive MCUs; programmable system-on-chip and general-purpose MCUs; analog power management integrated circuits and energy harvesting solutions; CapSense capacitive-sensing controllers; TrueTouch touchscreens; Wi-Fi, Bluetooth, and Bluetooth low energy; and USB controllers comprising solutions for the USB-C and USB power delivery standards, as well as wireless Internet of things connectivity solutions. The Memory Products Division provides NOR and NAND flash memories, static random access memory (SRAM) products, HyperRAm, synchronous and asynchronous SRAMs, nonvolatile SRAMs, F-RAM ferroelectric memory devices, and other specialty memories and clocks. The company serves various markets, including automotive, industrial, consumer, computation, white goods, communications, handset, PC peripherals, mobile devices, networking, telecommunications, video, data communications, computation, and medical markets. Cypress Semiconductor Corporation sells its semiconductor products through distributors and manufacturing representative firms, as well as through sales force directly to original equipment manufacturers and their suppliers. The company was founded in 1982 and is headquartered in San Jose, California.

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