Head-To-Head Analysis: POET Technologies (NASDAQ:POET) versus Power Integrations (NASDAQ:POWI)

Power Integrations (NASDAQ:POWI) and POET Technologies (NASDAQ:POET) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, profitability, risk, valuation and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Power Integrations and POET Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Power Integrations	0	2	3	0	2.60
POET Technologies	0	0	1	0	3.00

Power Integrations presently has a consensus price target of $86.17, indicating a potential upside of 28.09%. POET Technologies has a consensus price target of $7.50, indicating a potential upside of 200.00%. Given POET Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe POET Technologies is more favorable than Power Integrations.

Risk and Volatility

Power Integrations has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, POET Technologies has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500.

Insider and Institutional Ownership

2.0% of POET Technologies shares are owned by institutional investors. 1.7% of Power Integrations shares are owned by company insiders. Comparatively, 0.5% of POET Technologies shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Power Integrations and POET Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Power Integrations	12.54%	6.46%	5.84%
POET Technologies	N/A	-207.55%	-160.39%

Earnings and Valuation

This table compares Power Integrations and POET Technologies’ top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Power Integrations	$444.54 million	8.61	$55.74 million	$0.97	69.35
POET Technologies	$470,000.00	256.60	-$20.27 million	($0.51)	-4.90

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

Summary

Power Integrations beats POET Technologies on 10 of the 14 factors compared between the two stocks.

About Power Integrations

Power Integrations, Inc. designs, develops, manufactures, and markets analog and mixed-signal integrated circuits (ICs), and other electronic components and circuitry used in high-voltage power conversion worldwide. The company provides a range of alternating current to direct current power conversion products that address power supply ranging from less than one watt of output to approximately 500 watts of output for mobile-device chargers, consumer appliances, utility meters, LCD monitors, main and standby power supplies for desktop computers and TVs, LED lighting, and various other consumer and industrial applications, as well as power conversion in high-power applications comprising industrial motors, solar and wind-power systems, electric vehicles, and high-voltage DC transmission systems. It also offers high-voltage diodes; InnoSwitch IC for electric vehicles; high-voltage gate-driver products used to operate high-voltage switches, such as insulated-gate bipolar transistors and silicon-carbide MOSFETs under the SCALE and SCALE-2 product-family names; and SCALE-iDriver for use in powertrain and charging applications for electric vehicles. In addition, the company provides motor-driver ICs for use in refrigerator compressors, ceiling fans, and air purifiers, as well as pumps, fans, and blowers used in consumer appliances, such as dishwashers and laundry machines. It serves communications, computer, consumer, and industrial markets. The company sells its products to original equipment manufacturers and merchant power supply manufacturers through direct sales staff, as well as a network of independent sales representatives and distributors. Power Integrations, Inc. was incorporated in 1988 and is headquartered in San Jose, California.

About POET Technologies

POET Technologies Inc. designs, develops, manufactures, and sells discrete and integrated opto-electronic solutions in Canada, the United States, Singapore, and China. It offers integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques. It also develops photonic integrated components. The company serves the data center, telecommunications, Internet of things and industrial sensing, automotive LIDAR, optical coherence tomography for medical devices, and virtual reality systems markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. was incorporated in 1972 and is headquartered in Toronto, Canada.