Reviewing JinkoSolar (JKS) and Silicon Motion Technology (SIMO)

Silicon Motion Technology (NASDAQ:SIMO) and JinkoSolar (NYSE:JKS) are both small-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Profitability

This table compares Silicon Motion Technology and JinkoSolar’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Silicon Motion Technology 15.28% 15.97% 12.31%
JinkoSolar 0.58% 1.89% 0.45%



Dividends

Silicon Motion Technology pays an annual dividend of $1.19 per share and has a dividend yield of 3.1%. JinkoSolar does not pay a dividend. Silicon Motion Technology pays out 56.9% of its earnings in the form of a dividend. Silicon Motion Technology has raised its dividend for 2 consecutive years.

Analyst Ratings

This is a summary of recent recommendations and price targets for Silicon Motion Technology and JinkoSolar, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Silicon Motion Technology 1 3 9 0 2.62
JinkoSolar 3 3 1 0 1.71

Silicon Motion Technology presently has a consensus price target of $58.52, indicating a potential upside of 54.33%. JinkoSolar has a consensus price target of $17.25, indicating a potential upside of 129.39%. Given JinkoSolar’s higher possible upside, analysts clearly believe JinkoSolar is more favorable than Silicon Motion Technology.

Institutional and Insider Ownership

75.0% of Silicon Motion Technology shares are held by institutional investors. Comparatively, 24.8% of JinkoSolar shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Silicon Motion Technology has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500. Comparatively, JinkoSolar has a beta of 1.43, suggesting that its stock price is 43% more volatile than the S&P 500.

Valuation & Earnings

This table compares Silicon Motion Technology and JinkoSolar’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Silicon Motion Technology $523.40 million 2.62 $74.95 million $2.09 18.14
JinkoSolar $4.07 billion 0.05 $21.77 million $0.68 11.06

Silicon Motion Technology has higher earnings, but lower revenue than JinkoSolar. JinkoSolar is trading at a lower price-to-earnings ratio than Silicon Motion Technology, indicating that it is currently the more affordable of the two stocks.

Summary

Silicon Motion Technology beats JinkoSolar on 12 of the 16 factors compared between the two stocks.

Silicon Motion Technology Company Profile

Silicon Motion Technology Corporation, together with its subsidiaries, designs, develops, and markets semiconductor solutions for the mobile and enterprise storage, and mobile communications markets worldwide. It offers embedded storage and expandable storage products, including NAND flash controllers, such as embedded multimediacard (eMMC), universal flash storage, client solid-state drive (SSD), secure digital card, flash memory card controller, and universal serial bus flash drive controller products. The company also provides specialty storage solutions, such as customized enterprise-grade peripheral component interconnect express SSDs; and industrial-grade and commercial-grade single-chip SSDs. In addition, it offers specialty radio frequency integrated circuits (RF ICs), such as mobile TV system-on-chips (SoCs) and low power WiFi SoCs. The company's products are used in smartphones, tablets, digital cameras, camcorders, and desktop and notebook PCs, as well as in industrial, enterprise, commercial, and other applications. It offers its controllers under the SMI brand; enterprise-grade SSDs under the Shannon brand; single-chip industrial-grade SSDs under the Ferri SSD and Ferri-eMMC brands; RF ICs under the FCI brand; and software-defined storage products under the Bigtera brand. The company markets and sells its products through direct sales personnel and independent electronics distributors to flash manufacturers, original equipment manufacturers, and module makers. Silicon Motion Technology Corporation was founded in 1995 and is based in Kowloon, Hong Kong.

JinkoSolar Company Profile

JinkoSolar Holding Co., Ltd., together with its subsidiaries, engages in the design, development, production, and marketing of photovoltaic products in the People's Republic of China and internationally. The company offers solar modules, silicon wafers, solar cells, recovered silicon materials, and silicon ingots. It also provides solar system integration services; and develops commercial solar power projects. The company sells its products to distributors, project developers, and system integrators under the JinkoSolar brand, as well as on an original equipment manufacturer basis. JinkoSolar Holding Co., Ltd. was founded in 2006 and is based in Shangrao, the People's Republic of China.

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