Head to Head Contrast: Valens Semiconductor (NYSE:VLN) and GCT Semiconductor (NYSE:GCTS)

GCT Semiconductor (NYSE:GCTS) and Valens Semiconductor (NYSE:VLN) are both small-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares GCT Semiconductor and Valens Semiconductor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GCT Semiconductor	-1,010.20%	N/A	-198.45%
Valens Semiconductor	-44.38%	-23.12%	-18.88%

Risk and Volatility

GCT Semiconductor has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500. Comparatively, Valens Semiconductor has a beta of 0.26, meaning that its stock price is 74% less volatile than the S&P 500.

Valuation and Earnings

This table compares GCT Semiconductor and Valens Semiconductor”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GCT Semiconductor	$3.89 million	18.85	-$12.38 million	($0.77)	-1.67
Valens Semiconductor	$57.86 million	2.66	-$36.58 million	($0.29)	-5.19

GCT Semiconductor has higher earnings, but lower revenue than Valens Semiconductor. Valens Semiconductor is trading at a lower price-to-earnings ratio than GCT Semiconductor, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for GCT Semiconductor and Valens Semiconductor, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GCT Semiconductor	2	0	2	0	2.00
Valens Semiconductor	1	0	1	0	2.00

GCT Semiconductor currently has a consensus price target of $3.50, suggesting a potential upside of 172.37%. Valens Semiconductor has a consensus price target of $3.00, suggesting a potential upside of 99.34%. Given GCT Semiconductor’s higher possible upside, equities analysts plainly believe GCT Semiconductor is more favorable than Valens Semiconductor.

Institutional and Insider Ownership

28.1% of GCT Semiconductor shares are owned by institutional investors. Comparatively, 33.9% of Valens Semiconductor shares are owned by institutional investors. 5.4% of GCT Semiconductor shares are owned by company insiders. Comparatively, 58.9% of Valens Semiconductor shares are owned by company 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.

Summary

GCT Semiconductor beats Valens Semiconductor on 7 of the 13 factors compared between the two stocks.

About GCT Semiconductor

GCT Semiconductor Holding, Inc., operates as a fabless semiconductor company, designs, develops, and markets integrated circuits for the wireless semiconductor industry. The company provides RF and modem chipsets based on 4G LTE technology, including 4G LTE, 4.5G LTE Advanced, and 4.75G LTE Advanced-Pro. It also develops and sells cellular IoT chipsets for low-speed mobile networks such as eMTC/NB-IOT/Sigfox, and other network protocols; and 5G solutions. Its products and solutions are used in smartphones, tablets, hotspots, CPEs, USB dongles, routers, and M2M applications. The company sells its products directly or indirectly through distributors to original equipment manufacturers and original design manufacturers primarily in Taiwan, China, Korea and Japan, Europe, North America and South America. The company was formerly known as Global Communication Technology, Inc. GCT Semiconductor Holding, Inc. was founded in 1998 and is headquartered in San Jose, California.

About Valens Semiconductor

Valens Semiconductor Ltd. engages in the provision of semiconductor products for the audio-video and automotive industries. The company offers HDBaseT technology, which enables the simultaneous delivery of ultra-high-definition digital video and audio, Ethernet, USB, control signals, and power through a single long-reach cable. It also provides audio-video solutions for the enterprise, education, industrial, digital signage, industrial, and medical markets. In addition, it offers automotive chipsets that support advanced driver-assistance systems, automotive data solutions, infotainment, telematics, and backbone connectivity. The company’s product series include VS100, VS2000, VS3000, VS6000, VS7000, Valens USB and power extender, Valens VS6320, USB 3.2 Gen1 extension chipset, VA6000, and VA7000. It has a collaboration with iCatch Technology to develop a 360-degree multi-camera videoconferencing solution. The company operates in Israel, China, Hong Kong, the United States, Japan, Germany, Hungary, and internationally. Valens Semiconductor Ltd. is headquartered in Hod Hasharon, Israel.