NeoMagic (OTCMKTS:NMGC) versus Pixelworks (NASDAQ:PXLW) Critical Survey

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

Profitability

This table compares NeoMagic and Pixelworks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NeoMagic	N/A	N/A	N/A
Pixelworks	-73.07%	-490.11%	-40.74%

Earnings & Valuation

This table compares NeoMagic and Pixelworks”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NeoMagic	N/A	N/A	N/A	N/A	N/A
Pixelworks	$43.21 million	1.00	-$28.72 million	($4.72)	-1.45

NeoMagic has higher earnings, but lower revenue than Pixelworks.

Analyst Ratings

This is a breakdown of recent ratings for NeoMagic and Pixelworks, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NeoMagic	0	0	0	0	0.00
Pixelworks	1	0	4	0	2.60

Pixelworks has a consensus price target of $14.25, indicating a potential upside of 108.03%. Given Pixelworks’ stronger consensus rating and higher probable upside, analysts plainly believe Pixelworks is more favorable than NeoMagic.

Volatility and Risk

NeoMagic has a beta of 0.15, meaning that its stock price is 85% less volatile than the S&P 500. Comparatively, Pixelworks has a beta of 1.61, meaning that its stock price is 61% more volatile than the S&P 500.

Institutional and Insider Ownership

21.4% of Pixelworks shares are owned by institutional investors. 12.7% of NeoMagic shares are owned by company insiders. Comparatively, 5.3% of Pixelworks shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Pixelworks beats NeoMagic on 6 of the 10 factors compared between the two stocks.

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.

About Pixelworks

Pixelworks, Inc., together with its subsidiaries, develops and markets semiconductor and software solutions for mobile, home and enterprise, and cinema markets in the United States, Japan, China, Taiwan, Korea, and Europe. The company offers imageprocessor integrated circuits, such as embedded microprocessors, digital signal processing technology, and software that control the operations and signal processing within high-end display systems; visual processor integrated circuits that works with a mobile application processor; and transcoder integrated circuits which includes software that control the operations and signal processing for converting multiple bitrates, resolutions and codecs to provide bandwidth efficient video transmissions based on industry standard protocols. It also provides software and platform licensing products comprising Pixelworks Pro Software, a software that enables development and customize the look and feel of mobile products by use of various features, such as absolute color accuracy, HDR tone mapping, SDR-to-HDR conversion, and others; and TrueCut Motion Platform, content creation tool which provides the ability to dial in a motion look on a shot-by-shot basis. The company distributes its products to integrators, branded manufacturers, and branded suppliers. Pixelworks, Inc. was founded in 1997 and is based in Portland, Oregon.