Head-To-Head Survey: ASML (ASML) & Nanometrics (NANO)

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

Dividends

ASML pays an annual dividend of $1.11 per share and has a dividend yield of 0.5%. Nanometrics does not pay a dividend. ASML pays out 20.2% of its earnings in the form of a dividend.

Institutional & Insider Ownership

16.6% of ASML shares are held by institutional investors. Comparatively, 83.2% of Nanometrics shares are held by institutional investors. 6.7% of Nanometrics shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares ASML and Nanometrics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ASML 24.28% 21.16% 12.43%
Nanometrics 19.23% 10.26% 8.68%

Analyst Ratings

This is a summary of current recommendations and price targets for ASML and Nanometrics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ASML 0 4 12 0 2.75
Nanometrics 0 0 2 0 3.00

ASML presently has a consensus target price of $191.00, suggesting a potential downside of 7.07%. Nanometrics has a consensus target price of $32.50, suggesting a potential upside of 21.18%. Given Nanometrics’ stronger consensus rating and higher possible upside, analysts clearly believe Nanometrics is more favorable than ASML.

Volatility & Risk

ASML has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500. Comparatively, Nanometrics has a beta of 1.75, indicating that its share price is 75% more volatile than the S&P 500.

Earnings and Valuation

This table compares ASML and Nanometrics’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ASML $10.23 billion 8.64 $1.63 billion $5.49 37.44
Nanometrics $221.13 million 3.10 $44.03 million $1.79 14.98

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

Summary

ASML beats Nanometrics on 10 of the 16 factors compared between the two stocks.

About ASML

ASML Holding N.V. is a holding company. The Company is a manufacturer of chip-making equipment. The Company is engaged in the development, production, marketing, selling and servicing of semiconductor equipment systems, consisting of lithography systems. The Company’s products include systems, and installed base products and services. The Company’s principal operations are in the Netherlands, the United States and Asia. The Company offers TWINSCAN systems, equipped with lithography system with a mercury lamp as light source (i-line), Krypton Fluoride (KrF) and Argon Fluoride (ArF) light sources for 300 millimeter processing wafers for manufacturing environments for which imaging at a small resolution is required. TWINSCAN systems also include immersion lithography systems (TWINSCAN immersion systems). The Company also offers NXE systems, which are equipped with extreme ultraviolet (EUV) light source technology. The Company offers YieldStar, a wafer metrology system.

About Nanometrics

Nanometrics Incorporated is a provider of process control metrology and inspection systems used primarily in the fabrication of semiconductors and other solid-state devices, including sensors, optoelectronic devices, high-brightness (HB) light emitting diodes (LEDs), discretes and data storages components. The Company’s automated and integrated metrology systems measure critical dimensions, device structures, topography and various thin film properties, including three-dimensional features and film thickness, as well as optical, electrical and material properties. The Company’s process control solutions are deployed throughout the fabrication process, from front-end-of-line substrate manufacturing, to production of semiconductors and other devices, to three-dimensional wafer-level packaging applications. The Company’s automated systems primarily consist of automated metrology systems that are employed in semiconductor production environments.

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