ASE Technology (NYSE:ASX – Get Free Report) and Ambarella (NASDAQ:AMBA – Get Free Report) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.
Analyst Ratings
This is a summary of current recommendations and price targets for ASE Technology and Ambarella, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| ASE Technology | 1 | 1 | 1 | 0 | 2.00 |
| Ambarella | 1 | 4 | 7 | 2 | 2.71 |
Ambarella has a consensus target price of $96.00, suggesting a potential upside of 90.21%. Given Ambarella’s stronger consensus rating and higher probable upside, analysts clearly believe Ambarella is more favorable than ASE Technology.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| ASE Technology | $20.73 billion | 2.30 | $1.31 billion | $0.58 | 37.13 |
| Ambarella | $390.70 million | 5.66 | -$75.86 million | ($1.78) | -28.35 |
ASE Technology has higher revenue and earnings than Ambarella. Ambarella is trading at a lower price-to-earnings ratio than ASE Technology, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares ASE Technology and Ambarella’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| ASE Technology | 6.31% | 12.00% | 4.99% |
| Ambarella | -19.42% | -12.16% | -9.59% |
Institutional & Insider Ownership
6.8% of ASE Technology shares are held by institutional investors. Comparatively, 82.1% of Ambarella shares are held by institutional investors. 22.9% of ASE Technology shares are held by insiders. Comparatively, 5.3% of Ambarella shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
ASE Technology has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500. Comparatively, Ambarella has a beta of 1.95, suggesting that its share price is 95% more volatile than the S&P 500.
Summary
ASE Technology beats Ambarella on 8 of the 15 factors compared between the two stocks.
About ASE Technology
ASE Technology Holding Co., Ltd., together with its subsidiaries, provides semiconductors packaging and testing, and electronic manufacturing services in the United States, Taiwan, Asia, Europe, and internationally. It develops, constructs, sells, leases, and manages real estate properties; produces substrates; offers information software, equipment leasing, investment advisory, and warehousing management services; commercial complex, after-sales, and support services; manages parking lot services; processes and sells computer and communication peripherals, electronic components, telecommunications equipment, and motherboards; and imports and exports goods and technology. ASE Technology Holding Co., Ltd. was founded in 1984 and is based in Kaohsiung, Taiwan.
About Ambarella
Ambarella, Inc. develops semiconductor solutions that enable high-definition (HD) and ultra HD compression, image signal processing, and artificial intelligence processing worldwide. The company's system-on-a-chip designs integrated HD video processing, image processing, artificial intelligence computer vision algorithms, audio processing, and system functions onto a single chip for delivering video and image quality, differentiated functionality, and low power consumption. Its solutions are used in automotive cameras, such as automotive video recorders, electronic mirrors, front advanced driver assistance system camera, cabin monitoring system and driver monitoring system camera, and central domain controllers for autonomous vehicle; enterprise and public class, and home security camera; and robotics and industrial application, including identification/authentication cameras, robotic products, and sensing cameras, as well as cameras for the enterprise, home, public spaces, and consumer leisure comprising wearable body cameras, sports action cameras, social media cameras, drones for capturing aerial video or photographs, video conferencing, and virtual reality applications. The company sells its solutions to original design manufacturers and original equipment manufacturers through its direct sales force and distributors. Ambarella, Inc. was incorporated in 2004 and is headquartered in Santa Clara, California.
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