Head-To-Head Review: SkyWater Technology (NASDAQ:SKYT) versus FormFactor (NASDAQ:FORM)

SkyWater Technology (NASDAQ:SKYT) and FormFactor (NASDAQ:FORM) are both computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, profitability, risk, analyst recommendations and dividends.

Risk & Volatility

SkyWater Technology has a beta of 3.32, suggesting that its stock price is 232% more volatile than the S&P 500. Comparatively, FormFactor has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for SkyWater Technology and FormFactor, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SkyWater Technology	1	6	1	0	2.00
FormFactor	0	4	6	1	2.73

SkyWater Technology currently has a consensus target price of $32.00, suggesting a potential downside of 8.36%. FormFactor has a consensus target price of $132.45, suggesting a potential upside of 1.31%. Given FormFactor’s stronger consensus rating and higher possible upside, analysts plainly believe FormFactor is more favorable than SkyWater Technology.

Institutional & Insider Ownership

70.0% of SkyWater Technology shares are held by institutional investors. Comparatively, 98.8% of FormFactor shares are held by institutional investors. 22.6% of SkyWater Technology shares are held by insiders. Comparatively, 0.8% of FormFactor shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares SkyWater Technology and FormFactor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SkyWater Technology	21.04%	-7.88%	-1.93%
FormFactor	8.14%	9.31%	7.83%

Valuation & Earnings

This table compares SkyWater Technology and FormFactor”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SkyWater Technology	$442.14 million	3.89	$118.91 million	$2.33	14.99
FormFactor	$784.99 million	12.98	$54.36 million	$0.87	150.28

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

Summary

FormFactor beats SkyWater Technology on 10 of the 15 factors compared between the two stocks.

About SkyWater Technology

SkyWater Technology, Inc., together with its subsidiaries, operates as a pure-play technology foundry that engages in the provision of semiconductor development, manufacturing, and packaging services in the United States. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, micro-electromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive, bio-health, consumer, and industrial sectors. The company was incorporated in 2016 and is headquartered in Bloomington, Minnesota.

About FormFactor

FormFactor, Inc. designs, manufactures, and sells probe cards, analytical probes, probe stations, metrology systems, thermal systems, and cryogenic systems to semiconductor companies and scientific institutions in the United States, Taiwan, South Korea, China, Europe, Japan, Malaysia, Singapore, and internationally. It operates in two segments, Probe Cards and Systems. The company offers probe cards to test various semiconductor device types, including systems on a chip products, mobile application processors, microprocessors, microcontrollers, and graphic processors, as well as radio frequency, analog, mixed signal, image sensor, electro-optical, dynamic random access memory, NAND flash memory, and NOR flash memory devices, as well as computer processor devices; and analytical probes, which are used for a range of applications, including device characterization, electrical simulation model development, failure analysis, and prototype design debugging for universities, research institutions, semiconductor integrated device manufacturers, semiconductor foundries, and fabless semiconductor companies. It also provides probe systems for semiconductor design engineers to capture and analyze accurate data; surface metrology systems for the development, production, and quality control of semiconductor products; thermal subsystems, such as thermal chucks and other test systems used in probe stations and other applications; and precision cryogenic instruments, semiconductor tests, and measurement systems. In addition, the company offers on-site probe card maintenance and service training, seminars, and telephone support services. It markets and sells its products through direct sales force, manufacturers' representatives, and distributors. The company was incorporated in 1993 and is headquartered in Livermore, California.