Analyzing TOYO (NASDAQ:TOYO) and Semtech (NASDAQ:SMTC)

Semtech (NASDAQ:SMTC) and TOYO (NASDAQ:TOYO) are both technology companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Profitability

This table compares Semtech and TOYO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Semtech	13.11%	21.74%	8.98%
TOYO	N/A	N/A	N/A

Insider & Institutional Ownership

84.6% of TOYO shares are owned by institutional investors. 0.4% of Semtech shares are owned by insiders. Comparatively, 0.3% of TOYO shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Semtech and TOYO, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Semtech	0	3	15	1	2.89
TOYO	1	1	2	0	2.25

Semtech presently has a consensus price target of $213.11, indicating a potential upside of 50.47%. TOYO has a consensus price target of $14.00, indicating a potential upside of 247.39%. Given TOYO’s higher probable upside, analysts clearly believe TOYO is more favorable than Semtech.

Earnings and Valuation

This table compares Semtech and TOYO”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Semtech	$1.05 billion	12.59	-$40.38 million	$1.51	93.79
TOYO	$427.38 million	0.36	$39.66 million	$1.20	3.36

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

Risk & Volatility

Semtech has a beta of 2.41, indicating that its share price is 141% more volatile than the S&P 500. Comparatively, TOYO has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500.

Summary

Semtech beats TOYO on 11 of the 14 factors compared between the two stocks.

About Semtech

Semtech Corporation designs, develops, manufactures, and markets analog and mixed-signal semiconductor and advanced algorithms. It provides signal integrity products, including a portfolio of optical data communications and video transport products used in various infrastructure, and industrial applications; a portfolio of integrated circuits for data centers, enterprise networks, passive optical networks, wireless base station optical transceivers, and high-speed interface applications; and video products for broadcast applications, as well as video-over-IP technology for professional audio video applications. The company offers protection products, such as filter and termination devices that are integrated with the transient voltage suppressor devices, which protect electronic systems from voltage spikes; and sensing products comprising a portfolio of specialized radio frequency products used in various industrial, medical, and communications applications, as well as specialized sensing products. In addition, it provides switching voltage regulators, combination switching and linear regulators, smart regulators, isolated switches, and wireless charging related products. Further, it offers portfolio of IoT solutions, such as modules, gateways, routers, and connected services; and portfolio of connected services, including wireless connectivity and cloud-based services for industrial, medical and communications applications. The company serves original equipment manufacturers and industrial end-markets. It sells its products directly, as well as through independent sales representative firms and independent distributors in Asia- Pacific, North America, and Europe. Semtech Corporation was incorporated in 1960 and is headquartered in Camarillo, California.

About TOYO

TOYO Co. Ltd. engages in the design, manufacture, and sale of solar cells and modules. It is involved in integrating the upstream production of wafer and silicon, midstream production of solar cell, downstream production of photovoltaic (PV) modules, and potentially other stages of the solar power supply chain. The company was founded on November 8, 2022 and is headquartered in Tokyo, Japan.