Head-To-Head Survey: Sequans Communications (NYSE:SQNS) vs. Tower Semiconductor (NASDAQ:TSEM)

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

Volatility & Risk

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

Profitability

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

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

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tower Semiconductor	$1.57 billion	14.36	$220.47 million	$1.93	103.61
Sequans Communications	$27.19 million	1.71	-$102.44 million	($12.60)	-0.26

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.

Insider and Institutional Ownership

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

Analyst Recommendations

This is a breakdown of current ratings and target prices for Tower Semiconductor and Sequans Communications, as provided by MarketBeat.

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

Tower Semiconductor presently has a consensus target price of $173.00, suggesting a potential downside of 13.48%. Sequans Communications has a consensus target price of $20.33, suggesting a potential upside of 527.57%. Given Sequans Communications’ higher probable upside, analysts plainly believe Sequans Communications is more favorable than Tower Semiconductor.

Summary

Tower Semiconductor beats Sequans Communications on 10 of the 13 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 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.