Head-To-Head Comparison: Tokyo Electron (OTCMKTS:TOELY) and Key Tronic (NASDAQ:KTCC)

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Tokyo Electron and Key Tronic, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tokyo Electron	0	1	0	1	3.00
Key Tronic	0	0	0	0	0.00

Earnings and Valuation

This table compares Tokyo Electron and Key Tronic”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tokyo Electron	$15.97 billion	4.16	$3.59 billion	$3.89	18.51
Key Tronic	$467.87 million	N/A	-$8.32 million	($0.78)	-4.27

Tokyo Electron has higher revenue and earnings than Key Tronic. Key Tronic 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 Key Tronic’s 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%
Key Tronic	-1.78%	-6.17%	-2.22%

Institutional & Insider Ownership

1.3% of Tokyo Electron shares are held by institutional investors. Comparatively, 40.7% of Key Tronic shares are held by institutional investors. 6.1% of Key Tronic shares are held 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.

Volatility & Risk

Tokyo Electron has a beta of 1.8, indicating that its share price is 80% more volatile than the S&P 500. Comparatively, Key Tronic has a beta of 0.9, indicating that its share price is 10% less volatile than the S&P 500.

Summary

Tokyo Electron beats Key Tronic on 10 of the 12 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 Key Tronic

Key Tronic Corporation provides contract manufacturing services to original equipment manufacturers in the United States and internationally. The company offers integrated electronic and mechanical engineering, assembly, sourcing and procurement, logistics, and new product testing services. Its services include product design; surface mount technologies and pin through hole capability for printed circuit board assembly; tool making; precision plastic molding; sheet metal fabrication and painting; liquid injection molding; complex assembly; prototype design; and full product assembly services. The company manufactures and sells keyboards and other input devices. It markets its products and services primarily through field sales people and distributors. Key Tronic Corporation was incorporated in 1969 and is headquartered in Spokane Valley, Washington.