Taiwan Semiconductor Mfg. (NYSE: TSM) and Micron Technology (NASDAQ:MU) are both large-cap technology companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, analyst recommendations, profitability, dividends, institutional ownership and risk.
Earnings & Valuation
This table compares Taiwan Semiconductor Mfg. and Micron Technology’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Taiwan Semiconductor Mfg.||$32.11 billion||7.17||$11.27 billion||$2.27||19.56|
|Micron Technology||$20.32 billion||2.73||$5.09 billion||$6.35||7.56|
Volatility and Risk
Taiwan Semiconductor Mfg. has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, Micron Technology has a beta of 1.62, meaning that its stock price is 62% more volatile than the S&P 500.
This is a summary of current ratings for Taiwan Semiconductor Mfg. and Micron Technology, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Taiwan Semiconductor Mfg.||0||4||5||0||2.56|
Taiwan Semiconductor Mfg. presently has a consensus price target of $34.50, indicating a potential downside of 22.31%. Micron Technology has a consensus price target of $54.85, indicating a potential upside of 14.32%. Given Micron Technology’s stronger consensus rating and higher probable upside, analysts plainly believe Micron Technology is more favorable than Taiwan Semiconductor Mfg..
This table compares Taiwan Semiconductor Mfg. and Micron Technology’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Taiwan Semiconductor Mfg.||35.08%||24.18%||17.75%|
Taiwan Semiconductor Mfg. pays an annual dividend of $0.92 per share and has a dividend yield of 2.1%. Micron Technology does not pay a dividend. Taiwan Semiconductor Mfg. pays out 40.5% of its earnings in the form of a dividend. Taiwan Semiconductor Mfg. has raised its dividend for 3 consecutive years.
Institutional and Insider Ownership
19.2% of Taiwan Semiconductor Mfg. shares are owned by institutional investors. Comparatively, 81.3% of Micron Technology shares are owned by institutional investors. 1.1% of Taiwan Semiconductor Mfg. shares are owned by insiders. Comparatively, 0.5% of Micron Technology shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Micron Technology beats Taiwan Semiconductor Mfg. on 10 of the 18 factors compared between the two stocks.
About Taiwan Semiconductor Mfg.
Taiwan Semiconductor Manufacturing Company Limited (TSMC) is a semiconductor foundry. The Company is engaged in the manufacturing, selling, packaging, testing and computer-aided design of integrated circuits and other semiconductor devices and the manufacturing of masks. It operates through foundry segment. The foundry segment is engaged in manufacturing, selling, packaging, testing and computer-aided design of integrated circuits (IC) and other semiconductor devices and the manufacturing of masks. It operates three 12-inch wafer fabs, four eight-inch wafer fabs, one six-inch wafer fab (fab 2) and two backend fabs (advanced backend fab 1 and 2). It also manages two eight-inch fabs at its subsidiaries, WaferTech, LLC in the United States and TSMC China Company Limited. Its exploratory work focuses on transistors and technologies, such as three dimensional (3D) structures, strained-layer complementary metal-oxide semiconductor (CMOS), high-mobility materials and 3D IC devices.
About Micron Technology
Micron Technology, Inc. is engaged in semiconductor systems. The Company’s portfolio of memory technologies, including dynamic random-access memory (DRAM), negative-AND (NAND) Flash and NOR Flash are the basis for solid-state drives, modules, multi-chip packages and other system solutions. Its business segments include Compute and Networking Business Unit (CNBU), which includes memory products sold into compute, networking, graphics and cloud server markets; Mobile Business Unit (MBU), which includes memory products sold into smartphone, tablet and other mobile-device markets; Storage Business Unit (SBU), which includes memory products sold into enterprise, client, cloud and removable storage markets, and SBU also includes products sold to Intel through its Intel/Micron Flash Technology (IMFT) joint venture, and Embedded Business Unit (EBU), which includes memory products sold into automotive, industrial, connected home and consumer electronics markets.
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