Tokyo Electron (OTCMKTS:TOELY) and Universal Electronics (NASDAQ:UEIC) Critical Review

Tokyo Electron (OTCMKTS:TOELY) and Universal Electronics (NASDAQ:UEIC) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, earnings and profitability.

Analyst Recommendations

This is a breakdown of recent ratings for Tokyo Electron and Universal Electronics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tokyo Electron	0	1	0	1	3.00
Universal Electronics	0	1	1	0	2.50

Universal Electronics has a consensus target price of $11.00, indicating a potential upside of 129.17%. Given Universal Electronics’ higher possible upside, analysts plainly believe Universal Electronics is more favorable than Tokyo Electron.

Institutional & Insider Ownership

1.3% of Tokyo Electron shares are held by institutional investors. Comparatively, 79.4% of Universal Electronics shares are held by institutional investors. 9.4% of Universal Electronics shares are held 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.

Volatility & Risk

Tokyo Electron has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500. Comparatively, Universal Electronics has a beta of 1.62, suggesting that its stock price is 62% more volatile than the S&P 500.

Earnings & Valuation

This table compares Tokyo Electron and Universal Electronics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tokyo Electron	$15.97 billion	3.88	$3.59 billion	$3.89	17.29
Universal Electronics	$394.88 million	0.16	-$24.03 million	($1.25)	-3.84

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

Profitability

This table compares Tokyo Electron and Universal Electronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tokyo Electron	22.07%	28.97%	20.90%
Universal Electronics	-4.07%	-1.02%	-0.50%

Summary

Tokyo Electron beats Universal Electronics on 11 of the 15 factors compared between the two stocks.

About Tokyo Electron

Tokyo Electron Limited, together with its subsidiaries, develops, manufactures, and sells semiconductor and flat panel display (FPD) production equipment in Japan, Europe, North America, Taiwan, China, South Korea, Southeast Asia, and internationally. The company offers coaters/developers, etch systems, surface preparation systems, deposition systems, test systems, wafer bonders/debonders, wafer edge trimming, SiC epitaxial CVD systems, gas cluster ion beam system, and cleaning systems. It also provides plasma etch/ash systems for use in the manufacture of FPDs, as well as inkjet printing systems for manufacturing OLED displays. In addition, the company offers delivery, facility management, and non-life insurance services; sells semiconductor products, board computer products, software, and other electronic components; sells and supports network/storage/middleware related solutions; and develops, manufactures, and sells magnetic annealing systems. Tokyo Electron Limited was incorporated in 1951 and is headquartered in Tokyo, Japan.

About Universal Electronics

Universal Electronics Inc. designs, develops, manufactures, ships, and supports control and sensor technology solutions in the United States, the People’s Republic of China, rest of Asia, Europe, Latin America, and internationally. The company offers voice-enabled automatically-programmed universal two-way radio frequency, as well as infrared remote controls to video service providers, original equipment manufacturers (OEMs), retailers, and private label customers; wall-mount and handheld thermostat controllers and connected accessories for smart energy management systems to OEM customers, hotels, hospitality, and system integrators; proprietary and standards-based RF sensors for residential security, safety, and home automation applications; and integrated circuits on which its software and universal device control database is embedded to OEMs, video service providers, and private label customers. It also provides software, firmware and technology solutions that can enable devices such as Smart TVs, hybrid set-top boxes, audio systems, smart speakers, game consoles, and other consumer electronic and smart home devices to wirelessly connect and interoperate within home networks; cloud-services that support its embedded software and hardware solutions; intellectual property that the company licenses to OEMs and video service providers; embedded and cloud-enabled software for firmware update provisioning and digital rights management validation services to consumer electronics brands; and AV accessories, including universal remote controls, television wall mounts and stands, and digital television antennas. In addition, the company QuickSet, a software application that can be embedded in entertainment or smart home platform or can be delivered as a cloud-based service, through QuickSet Cloud, to enable universal device setup, interoperability, and control. Universal Electronics Inc. was incorporated in 1986 and is based in Scottsdale, Arizona.