Critical Contrast: Magnachip Semiconductor (NYSE:MX) versus MKS (NASDAQ:MKSI)

Magnachip Semiconductor (NYSE:MX) and MKS (NASDAQ:MKSI) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, profitability, earnings and dividends.

Institutional and Insider Ownership

74.3% of Magnachip Semiconductor shares are held by institutional investors. Comparatively, 99.8% of MKS shares are held by institutional investors. 10.9% of Magnachip Semiconductor shares are held by insiders. Comparatively, 0.6% of MKS shares are held by 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.

Risk and Volatility

Magnachip Semiconductor has a beta of 1.65, indicating that its share price is 65% more volatile than the S&P 500. Comparatively, MKS has a beta of 2.03, indicating that its share price is 103% more volatile than the S&P 500.

Profitability

This table compares Magnachip Semiconductor and MKS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magnachip Semiconductor	-17.26%	-5.84%	-4.10%
MKS	10.15%	24.72%	7.80%

Valuation & Earnings

This table compares Magnachip Semiconductor and MKS”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magnachip Semiconductor	$177.43 million	0.66	-$29.72 million	($0.84)	-3.83
MKS	$3.93 billion	4.66	$295.00 million	$6.27	43.20

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

Analyst Ratings

This is a summary of current recommendations for Magnachip Semiconductor and MKS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magnachip Semiconductor	1	1	0	0	1.50
MKS	1	2	12	1	2.81

MKS has a consensus target price of $375.93, suggesting a potential upside of 38.79%. Given MKS’s stronger consensus rating and higher probable upside, analysts plainly believe MKS is more favorable than Magnachip Semiconductor.

Summary

MKS beats Magnachip Semiconductor on 14 of the 15 factors compared between the two stocks.

About Magnachip Semiconductor

Magnachip Semiconductor Corporation, together with its subsidiaries, designs, manufactures, and supplies analog and mixed-signal semiconductor platform solutions for communications, the Internet of Things, consumer, computing, industrial, and automotive applications. It provides display solutions, including source and gate drivers, and timing controllers that cover a range of flat panel displays used in mobile communications, automotive, entertainment devices, monitors, notebook PCs, tablet PC and TVs applied with liquid crystal display, organic light emitting diodes (OLED), and micro light emitting diode (Micro LED) panel. The company also offers metal oxide semiconductor field-effect transistors, insulated-gate bipolar transistors, AC-DC converters, DC-DC converters, LED drivers, regulators, and power management integrated circuits for a range of devices comprising televisions, smartphones, mobile phones, wearable devices, desktop PCs, notebooks, tablet PCs, and other consumer electronics, as well as for power suppliers, e-bikes, photovoltaic inverters, LED lighting, and motor drives; and OLED display driver integrated circuit products. It serves consumer, computing, communication, automotive and industrial electronics OEMs, original design manufacturers, and electronics manufacturing services companies, as well as subsystem designers in the Asia Pacific, the United States, and Europe. The company sells its products through a direct sales force, as well as through a network of agents and distributors. Magnachip Semiconductor Corporation was incorporated in 2003 and is based in Cheongju-si, South Korea.

About MKS

MKS Instruments, Inc. provides foundational technology solutions to semiconductor manufacturing, electronics and packaging, and specialty industrial applications in the United States, Germany, China, South Korea, and internationally. It operates through Vacuum Solutions Division (VSD), Photonics Solutions Division (PSD), and Material Solutions Division (MSD) segments. The VSD segment provides foundational technology solutions, including pressure measurement and control, flow measurement and control, gas and vapor delivery, gas composition analysis, electronic control technology, reactive gas generation and delivery, power generation and delivery, and vacuum technology. The PSD segment offers range of solutions, which include lasers, beam measurement and profiling, precision motion control, vibration isolation systems, photonics instruments, temperature sensing, opto-mechanical components, optical elements, systems for flexible PCB laser processing, and laser-based systems, as well as high density interconnect PCB and package manufacturing. The MSD segment develops, process, and manufactures technologies comprising advanced surface modification, electroless and electrolytic plating, and surface finishing for chemistry, equipment, software, and services markets, as well as high-technology applications. In addition, the company sells its products and services through direct sales, network of independent distributors, and sales representatives, as well as websites, including product catalogs. The company was incorporated in 1961 and is headquartered in Andover, Massachusetts.