Head-To-Head Contrast: KLA (NASDAQ:KLAC) versus Hon Hai Precision Industry Co., Ltd. Sponsored GDR (OTCMKTS:HNHPF)

Hon Hai Precision Industry Co., Ltd. Sponsored GDR (OTCMKTS:HNHPF) and KLA (NASDAQ:KLAC) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.

Dividends

Hon Hai Precision Industry Co., Ltd. Sponsored GDR pays an annual dividend of $0.28 per share and has a dividend yield of 2.0%. KLA pays an annual dividend of $7.60 per share and has a dividend yield of 0.5%. KLA pays out 22.1% of its earnings in the form of a dividend. KLA has increased its dividend for 16 consecutive years.

Earnings and Valuation

This table compares Hon Hai Precision Industry Co., Ltd. Sponsored GDR and KLA”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hon Hai Precision Industry Co., Ltd. Sponsored GDR	$213.33 billion	N/A	$4.75 billion	N/A	N/A
KLA	$12.16 billion	15.69	$4.06 billion	$34.37	42.35

Hon Hai Precision Industry Co., Ltd. Sponsored GDR has higher revenue and earnings than KLA.

Profitability

This table compares Hon Hai Precision Industry Co., Ltd. Sponsored GDR and KLA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hon Hai Precision Industry Co., Ltd. Sponsored GDR	2.46%	11.43%	4.68%
KLA	35.76%	98.18%	29.24%

Risk & Volatility

Hon Hai Precision Industry Co., Ltd. Sponsored GDR has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, KLA has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Hon Hai Precision Industry Co., Ltd. Sponsored GDR and KLA, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hon Hai Precision Industry Co., Ltd. Sponsored GDR	0	0	1	0	3.00
KLA	0	9	19	1	2.72

KLA has a consensus price target of $1,601.04, suggesting a potential upside of 10.00%. Given KLA’s higher possible upside, analysts clearly believe KLA is more favorable than Hon Hai Precision Industry Co., Ltd. Sponsored GDR.

Insider and Institutional Ownership

86.7% of KLA shares are owned by institutional investors. 91.5% of KLA shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

KLA beats Hon Hai Precision Industry Co., Ltd. Sponsored GDR on 10 of the 15 factors compared between the two stocks.

About Hon Hai Precision Industry Co., Ltd. Sponsored GDR

Hon Hai Precision Industry Co., Ltd. provides electronic OEM services. The company offers consumer electronics comprising of television sets, game consoles, set-top boxes, and speakers. It also provides cloud networking products consisting of routers, servers, edge computing, data centers, and satellite communications and other related equipment. In addition, the company offers desktop computers, notebook computers, tablets, business machines, printers, etc. Further, it provides connectors, precision optical components, lenses, electronic components, semiconductor products, automotive electronic parts, cutting tools/mold fixtures, and mechanical equipment. The company operates in Taiwan, Mainland China, India, Japan, Vietnam, Malaysia, Singapore, the Czech Republic, Hungary, Slovakia, the United States, Brazil, and Mexico. Hon Hai Precision Industry Co., Ltd. was founded in 1974 and is headquartered in New Taipei City, Taiwan.

About KLA

KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection. The company offers inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers; chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk. It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, inkjet and additive printing, UV laser drilling, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.