Head to Head Analysis: GCT Semiconductor (NYSE:GCTS) vs. Tower Semiconductor (NASDAQ:TSEM)

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Tower Semiconductor	12.92%	7.16%	6.20%
GCT Semiconductor	-1,010.20%	N/A	-198.45%

Earnings & Valuation

This table compares Tower Semiconductor and GCT Semiconductor”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tower Semiconductor	$1.44 billion	N/A	$207.86 million	$1.72	70.78
GCT Semiconductor	$9.13 million	7.57	-$12.38 million	($0.77)	-1.57

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

Volatility & Risk

Tower Semiconductor has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, GCT Semiconductor has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Tower Semiconductor and GCT Semiconductor, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tower Semiconductor	0	3	2	0	2.40
GCT Semiconductor	2	0	2	0	2.00

Tower Semiconductor presently has a consensus target price of $119.25, suggesting a potential downside of 2.05%. GCT Semiconductor has a consensus target price of $3.50, suggesting a potential upside of 189.26%. Given GCT Semiconductor’s higher probable upside, analysts plainly believe GCT Semiconductor is more favorable than Tower Semiconductor.

Institutional and Insider Ownership

70.5% of Tower Semiconductor shares are owned by institutional investors. Comparatively, 28.1% of GCT Semiconductor shares are owned by institutional investors. 1.0% of Tower Semiconductor shares are owned by insiders. Comparatively, 5.4% of GCT Semiconductor shares are owned 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.

Summary

Tower Semiconductor beats GCT Semiconductor on 9 of the 12 factors compared between the two stocks.

About Tower Semiconductor

Tower Semiconductor Ltd., an independent semiconductor foundry, focus on specialty process technologies to manufacture analog intensive mixed-signal semiconductor devices in Israel, the United States, Japan, Europe, and internationally. It provides various customizable process technologies, including SiGe, BiCMOS, mixed signal/CMOS, RF CMOS, CMOS image sensor, integrated power management, and MEMS. The Company also provides design enablement platform for quick and accurate design cycle, as well as transfer optimization and development process services to integrated device manufacturers and fabless companies. It serves various markets, such as consumer electronics, personal computers, communications, automotive, industrial, aerospace, military, and medical device products. The company was incorporated in 1993 and is headquartered in Migdal Haemek, Israel.

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.