Critical Analysis: Cirrus Logic (NASDAQ:CRUS) vs. AXT (NASDAQ:AXTI)

AXT (NASDAQ:AXTIGet Free Report) and Cirrus Logic (NASDAQ:CRUSGet Free Report) are both computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Risk and Volatility

AXT has a beta of 2.26, meaning that its share price is 126% more volatile than the S&P 500. Comparatively, Cirrus Logic has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500.

Valuation & Earnings

This table compares AXT and Cirrus Logic”s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AXT $99.36 million 2.38 -$11.62 million ($0.55) -9.33
Cirrus Logic $1.90 billion 3.44 $331.51 million $6.39 19.90

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

Analyst Recommendations

This is a breakdown of recent ratings and target prices for AXT and Cirrus Logic, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AXT 1 0 4 0 2.60
Cirrus Logic 0 2 4 0 2.67

AXT presently has a consensus target price of $4.60, indicating a potential downside of 10.33%. Cirrus Logic has a consensus target price of $123.00, indicating a potential downside of 3.27%. Given Cirrus Logic’s stronger consensus rating and higher possible upside, analysts plainly believe Cirrus Logic is more favorable than AXT.

Profitability

This table compares AXT and Cirrus Logic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AXT -27.68% -11.38% -7.02%
Cirrus Logic 18.15% 18.38% 15.29%

Insider & Institutional Ownership

49.5% of AXT shares are owned by institutional investors. Comparatively, 88.0% of Cirrus Logic shares are owned by institutional investors. 8.8% of AXT shares are owned by company insiders. Comparatively, 1.2% of Cirrus Logic shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Cirrus Logic beats AXT on 11 of the 13 factors compared between the two stocks.

About AXT

(Get Free Report)

AXT, Inc. designs, develops, manufactures, and distributes compound and single element semiconductor substrates. The company offers indium phosphide for use in data center connectivity using light/lasers, high-speed data transfer in data centers, 5G communications, fiber optic lasers and detectors, consumer devices, passive optical networks, silicon photonics, photonic integrated circuits, thermo-photovoltaics, RF amplifier and switching, infrared light-emitting diode (LEDS) motion control, lidar for robotics and autonomous vehicles, and infrared thermal imaging. It also provides semi-insulating gallium arsenide (GaAs) substrates for use in Wi-Fi and IoT devices, transistors, direct broadcast television, power amplifiers, satellite communications, and solar cells; and semi-conducting GaAs substrates that are used in LEDs, screen displays using micro-LEDs, printer head lasers and LEDs, 3-D sensing using VCSELs, data center communication using VCSELs, sensors for industrial robotics/near-infrared sensors, optical couplers, solar cells, night vision goggles, lidar for robotics and autonomous vehicles, and other lasers, as well as laser machining, cutting, and drilling. In addition, the company offers germanium substrates for use in multi-junction solar cells for satellites, optical sensors and detectors, terrestrial concentrated photo voltaic cells, infrared detectors, and carrier wafer for LED. Further, it provides 6N+ and 7N+ purified gallium, boron trioxide, gallium-magnesium alloy, pyrolytic boron nitride (pBN) crucibles, and pBN insulating parts. It sells its products through direct salesforce in the United States, China, and Europe, as well as through independent sales representatives and distributors in Japan, Taiwan, Korea, and internationally. The company was formerly known as American Xtal Technology, Inc. and changed its name to AXT, Inc. in July 2000. AXT, Inc. was incorporated in 1986 and is headquartered in Fremont, California.

About Cirrus Logic

(Get Free Report)

Cirrus Logic, Inc., a fabless semiconductor company, develops low-power high-precision mixed-signal processing solutions in China, the United States, and internationally. The company offers audio products, including amplifiers; codecs components that integrate analog-to-digital converters (ADCs) and digital-to-analog converters (DACs) into a single integrated circuit (IC); smart codecs, a codec with integrated digital signal processing; standalone digital signal processors; and SoundClear technology, which consists of a portfolio of tools, software, and algorithms that helps to enhance user experience with features, such as louder, high-fidelity sound, audio playback, voice capture, and hearing augmentation for use in smartphones, tablets, laptops, AR/VR headsets, home theater systems, automotive entertainment systems, and professional audio systems. It also provides high-performance mixed-signal products comprising camera controllers, haptic and sensing solutions, and battery and power ICs for use in smartphones, as well as legacy industrial and energy applications, such as digital utility meters, power supplies, energy control, energy measurement, and energy exploration. The company markets and sells its products through direct sales force, external sales representatives, and distributors. Cirrus Logic, Inc. was incorporated in 1984 and is headquartered in Austin, Texas.

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