Critical Survey: Sequans Communications (NYSE:SQNS) & Tower Semiconductor (NASDAQ:TSEM)

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

Valuation and Earnings

This table compares Sequans Communications and Tower Semiconductor”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sequans Communications	$27.19 million	1.52	-$102.44 million	($12.60)	-0.23
Tower Semiconductor	$1.57 billion	14.45	$220.47 million	$1.93	104.28

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Sequans Communications	-401.31%	-42.03%	-21.55%
Tower Semiconductor	14.08%	7.86%	6.84%

Institutional & Insider Ownership

63.3% of Sequans Communications shares are owned by institutional investors. Comparatively, 70.5% of Tower Semiconductor shares are owned by institutional investors. 9.4% of Sequans Communications shares are owned by insiders. Comparatively, 1.0% of Tower Semiconductor shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations for Sequans Communications and Tower Semiconductor, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sequans Communications	2	0	2	1	2.40
Tower Semiconductor	0	3	2	0	2.40

Sequans Communications presently has a consensus price target of $20.33, indicating a potential upside of 603.33%. Tower Semiconductor has a consensus price target of $173.00, indicating a potential downside of 14.05%. Given Sequans Communications’ higher probable upside, equities analysts clearly believe Sequans Communications is more favorable than Tower Semiconductor.

Risk and Volatility

Sequans Communications has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500. Comparatively, Tower Semiconductor has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500.

Summary

Tower Semiconductor beats Sequans Communications on 10 of the 13 factors compared between the two stocks.

About Sequans Communications

Sequans Communications S.A. engages in the fabless designing, developing, and supplying of cellular semiconductor solutions for massive and broadband Internet of Things (IoT) markets in Taiwan, Korea, China, rest of Asia, Germany, the United States, and internationally. It offers baseband solutions for use in encoding and decoding data based on 4G and 5G protocols for wireless processing platform for a cellular device; RF transceivers used to transmit and receive wireless transmissions; highly integrated SoC solutions that combine various functions into a single die or package; and LTE modules. The company also provides software, including source code and tools to enable manufacturers to integrate their solutions into their devices; and design support services. The company serves OEMs and ODMs Customers, as well as 4G and 5G wireless carriers. Sequans Communications S.A. was incorporated in 2003 and is based in Paris, France.

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.