Head to Head Review: NeoMagic (OTCMKTS:NMGC) vs. GCT Semiconductor (NYSE:GCTS)

GCT Semiconductor (NYSE:GCTS) and NeoMagic (OTCMKTS:NMGC) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, risk, earnings and dividends.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GCT Semiconductor	$9.13 million	7.48	-$2.00 million	($0.26)	-5.44
NeoMagic	N/A	N/A	N/A	N/A	N/A

NeoMagic has lower revenue, but higher earnings than GCT Semiconductor.

Volatility & Risk

GCT Semiconductor has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, NeoMagic has a beta of 0.42, suggesting that its share price is 58% less volatile than the S&P 500.

Profitability

This table compares GCT Semiconductor and NeoMagic’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GCT Semiconductor	N/A	N/A	-27.81%
NeoMagic	N/A	N/A	N/A

Institutional & Insider Ownership

28.1% of GCT Semiconductor shares are held by institutional investors. 0.2% of GCT Semiconductor shares are held by insiders. Comparatively, 12.7% of NeoMagic shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for GCT Semiconductor and NeoMagic, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GCT Semiconductor	0	0	1	0	3.00
NeoMagic	0	0	0	0	0.00

GCT Semiconductor presently has a consensus target price of $5.00, suggesting a potential upside of 253.36%. Given GCT Semiconductor’s stronger consensus rating and higher probable upside, analysts clearly believe GCT Semiconductor is more favorable than NeoMagic.

Summary

GCT Semiconductor beats NeoMagic on 6 of the 8 factors compared between the two stocks.

About GCT Semiconductor

GCT Semiconductor Holding, Inc., operates as a fabless semiconductor company, designs, develops, and markets integrated circuits for the wireless semiconductor industry. The company provides RF and modem chipsets based on 4G LTE technology, including 4G LTE, 4.5G LTE Advanced, and 4.75G LTE Advanced-Pro. It also develops and sells cellular IoT chipsets for low-speed mobile networks such as eMTC/NB-IOT/Sigfox, and other network protocols; and 5G solutions. Its products and solutions are used in smartphones, tablets, hotspots, CPEs, USB dongles, routers, and M2M applications. The company sells its products directly or indirectly through distributors to original equipment manufacturers and original design manufacturers primarily in Taiwan, China, Korea and Japan, Europe, North America and South America. The company was formerly known as Global Communication Technology, Inc. GCT Semiconductor Holding, Inc. was founded in 1998 and is headquartered in San Jose, California.

About NeoMagic

NeoMagic Corporation designs and delivers semiconductors and software solutions for video, television, imaging, graphic, and audio devices. It offers microcontrollers; horizon digital picture frame and digital mobile TV solutions; and SOC processors, such as application processors and Neomobile TV solutions. The company, through its MercadoMagico.com division, operates an e-Commerce platform that allows user to buy and sell products from one another or buy premium electronic products. It sells its applications processors under the MiMagic brand name. The company was founded in 1993 and is based in Milpitas, California.