NVE (NVEC) & Microchip Technology (MCHP) Head-To-Head Contrast

NVE (NASDAQ:NVEC) and Microchip Technology (NASDAQ:MCHP) are both computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, risk, valuation and profitability.

Institutional and Insider Ownership

76.8% of NVE shares are held by institutional investors. 2.4% of NVE shares are held by company insiders. Comparatively, 2.1% of Microchip Technology shares are held by company 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.



Analyst Recommendations

This is a summary of recent recommendations and price targets for NVE and Microchip Technology, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NVE 0 0 0 0 N/A
Microchip Technology 0 6 11 0 2.65

Microchip Technology has a consensus price target of $103.24, suggesting a potential upside of 7.99%. Given Microchip Technology’s higher probable upside, analysts plainly believe Microchip Technology is more favorable than NVE.

Profitability

This table compares NVE and Microchip Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NVE 53.96% 18.22% 18.00%
Microchip Technology 6.53% 32.30% 9.41%

Volatility and Risk

NVE has a beta of 1.3, meaning that its share price is 30% more volatile than the S&P 500. Comparatively, Microchip Technology has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500.

Dividends

NVE pays an annual dividend of $4.00 per share and has a dividend yield of 4.1%. Microchip Technology pays an annual dividend of $1.46 per share and has a dividend yield of 1.5%. Microchip Technology pays out 28.1% of its earnings in the form of a dividend. Microchip Technology has raised its dividend for 17 consecutive years.

Earnings and Valuation

This table compares NVE and Microchip Technology’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NVE $29.86 million 15.95 $13.91 million N/A N/A
Microchip Technology $3.98 billion 5.69 $255.40 million $5.19 18.42

Microchip Technology has higher revenue and earnings than NVE.

Summary

NVE beats Microchip Technology on 9 of the 15 factors compared between the two stocks.

About NVE

NVE Corporation develops and sells devices that use spintronics, a nanotechnology that utilizes electron spin to acquire, store, and transmit information. The company manufactures spintronic products, including sensors and couplers for use in acquiring and transmitting data. Its products comprise standard sensors to detect the presence of a magnetic or metallic material to determine position or speed primarily for the factory automation market; and custom and medical sensors for medical devices to replace electromechanical magnetic switches. The company also offers spintronic couplers, such as IL500-series couplers, IL600-series passive-input couplers, IL700/IL200-series high-speed couplers, IL4/IL3-series isolated network couplers, and IL800-series top-of-the-line couplers. In addition, it licenses the spintronic magnetoresistive random access memory technology, as well as conducts contract research and development activities. The company sells its products through distributors in the United States, Europe, the Middle East, Africa, Asia-Pacific, and internationally. NVE Corporation was founded in 1989 and is headquartered in Eden Prairie, Minnesota.

About Microchip Technology

Microchip Technology Incorporated develops, manufactures, and sells semiconductor products for various embedded control applications. The company offers general purpose and specialized 8-bit, 16-bit, and 32-bit microcontrollers; 32-bit microprocessors; and microcontrollers for automotive networking, computing, lighting, power supplies, motor control, human machine interface, security, wired connectivity, and wireless connectivity. It also provides development tools that enable system designers to program microcontroller products for specific applications; analog, interface, mixed signal, and timing products comprising power management, linear, mixed-signal, high-voltage, thermal management, radio frequency (RF), drivers, safety, security, timing, USB, Ethernet, wireless, and other interface products; and memory products consisting of serial electrically erasable programmable read-only memory, serial flash memories, parallel flash memories, and serial static random access memories for the production of very small footprint devices. In addition, the company licenses its SuperFlash embedded flash and Smartbits one time programmable NVM technologies to foundries, integrated device manufacturers, and design partners for use in the manufacture of microcontroller products, gate array, RF, and analog products that require embedded non-volatile memory, as well as provides engineering services. Further, it provides wafer foundry and assembly and test subcontracting manufacturing services; and application specific integrated circuits, complex programmable logic devices, and aerospace products. It serves automotive, communications, computing, consumer, aerospace, defense, safety, security, medical, and industrial control markets. The company sells its products through a network of direct sales personnel and distributors in the Americas, Europe, and Asia. Microchip Technology Incorporated was founded in 1989 and is headquartered in Chandler, Arizona.

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