Critical Survey: BE Semiconductor Industries (OTCMKTS:BESIY) vs. United Microelectronics (NYSE:UMC)

BE Semiconductor Industries (OTCMKTS:BESIY) and United Microelectronics (NYSE:UMC) 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.

Profitability

This table compares BE Semiconductor Industries and United Microelectronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BE Semiconductor Industries	28.56%	38.81%	18.45%
United Microelectronics	23.90%	14.80%	9.41%

Volatility and Risk

BE Semiconductor Industries has a beta of 1.75, meaning that its share price is 75% more volatile than the S&P 500. Comparatively, United Microelectronics has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.

Institutional and Insider Ownership

5.1% of United Microelectronics shares are held by institutional investors. 1.6% of BE Semiconductor Industries shares are held by company insiders. Comparatively, 8.0% of United Microelectronics 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 BE Semiconductor Industries and United Microelectronics, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BE Semiconductor Industries	0	0	0	0	N/A
United Microelectronics	0	1	2	0	2.67

United Microelectronics has a consensus price target of $8.90, suggesting a potential upside of 1.71%. Given United Microelectronics’ higher probable upside, analysts plainly believe United Microelectronics is more favorable than BE Semiconductor Industries.

Earnings and Valuation

This table compares BE Semiconductor Industries and United Microelectronics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BE Semiconductor Industries	$626.45 million	N/A	$191.66 million	$2.39	50.79
United Microelectronics	$7.25 billion	3.03	$1.95 billion	$0.70	12.50

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

Dividends

BE Semiconductor Industries pays an annual dividend of $1.96 per share and has a dividend yield of 1.6%. United Microelectronics pays an annual dividend of $0.35 per share and has a dividend yield of 4.0%. BE Semiconductor Industries pays out 82.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. United Microelectronics pays out 50.0% of its earnings in the form of a dividend. United Microelectronics is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

United Microelectronics beats BE Semiconductor Industries on 8 of the 14 factors compared between the two stocks.

About BE Semiconductor Industries

BE Semiconductor Industries N.V. engages in the development, manufacture, marketing, sale, and service of semiconductor assembly equipment for the semiconductor and electronics industries in China, the United States, Malaysia, Ireland, Korea, Taiwan, Thailand, Other Asia Pacific and Europe, and internationally. It operates through three segments: Die Attach, Packaging, and Plating. The company's principal products include die attach equipment, such as single chip, multi-chip, multi module, flip chip, thermal compression bonding, fan out wafer level packaging, hybrid and embedded bridge die bonding, and die sorting systems; and packaging equipment, including conventional, ultra-thin, and wafer level molding, as well as trim and form, and singulation systems. It also provides plating equipment, such as tin, copper, and precious metal and solar plating systems, as well as related process chemicals; and tooling, conversion kits, spare parts, and other services. The company's principal brand names include Datacon, Esec, Fico, and Meco. It offers its products primarily to multinational chip manufacturers, assembly subcontractors, and electronics and industrial companies. BE Semiconductor Industries N.V. was incorporated in 1995 and is headquartered in Duiven, the Netherlands.

About United Microelectronics

United Microelectronics Corporation operates as a semiconductor wafer foundry in Taiwan, Singapore, China, Hong Kong, Japan, the United States, Europe, and internationally. The company provides circuit design, mask tooling, wafer fabrication, and assembly and testing services. It serves fabless design companies and integrated device manufacturers. The company was incorporated in 1980 and is headquartered in Hsinchu City, Taiwan.