Reviewing Ichor (NASDAQ:ICHR) & Taiwan Semiconductor Mfg. (TSM)

Taiwan Semiconductor Mfg. (NASDAQ: ICHR) and Ichor (NASDAQ:ICHR) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.

Earnings and Valuation

This table compares Taiwan Semiconductor Mfg. and Ichor’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Taiwan Semiconductor Mfg. $32.11 billion 7.04 $11.64 billion $2.17 20.09
Ichor $655.89 million 0.96 $56.45 million $2.41 10.76

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

Analyst Recommendations

This is a breakdown of current ratings and target prices for Taiwan Semiconductor Mfg. and Ichor, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Taiwan Semiconductor Mfg. 0 4 7 0 2.64
Ichor 0 0 4 1 3.20

Taiwan Semiconductor Mfg. presently has a consensus target price of $42.00, suggesting a potential downside of 3.67%. Ichor has a consensus target price of $38.60, suggesting a potential upside of 48.86%. Given Ichor’s stronger consensus rating and higher probable upside, analysts plainly believe Ichor is more favorable than Taiwan Semiconductor Mfg..

Dividends

Taiwan Semiconductor Mfg. pays an annual dividend of $1.04 per share and has a dividend yield of 2.4%. Ichor does not pay a dividend. Taiwan Semiconductor Mfg. pays out 47.9% of its earnings in the form of a dividend. Taiwan Semiconductor Mfg. has raised its dividend for 3 consecutive years.

Insider and Institutional Ownership

19.1% of Taiwan Semiconductor Mfg. shares are held by institutional investors. Comparatively, 87.3% of Ichor shares are held by institutional investors. 1.1% of Taiwan Semiconductor Mfg. shares are held by insiders. Comparatively, 2.2% of Ichor shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Taiwan Semiconductor Mfg. has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500. Comparatively, Ichor has a beta of 4.67, indicating that its share price is 367% more volatile than the S&P 500.

Profitability

This table compares Taiwan Semiconductor Mfg. and Ichor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Taiwan Semiconductor Mfg. 34.74% 23.19% 17.60%
Ichor 8.60% 38.00% 16.26%

About Taiwan Semiconductor Mfg.

Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, engages in manufacturing, selling, packaging, testing, and computer-aided design of integrated circuits and other semiconductor devices. The company manufactures masks and electronic spare parts; researches, develops, designs, manufactures, sells, packages, and tests color filters; and offers customer and engineering support services. It is also involved in investing activities. The company operates in Taiwan, the United States, Asia, Europe, the Middle East, Africa, and internationally. Taiwan Semiconductor Manufacturing Company Limited was founded in 1987 and is headquartered in HsinChu, Taiwan.

About Ichor

Ichor Holdings, Ltd. engages in the design, engineering, and manufacture of fluid delivery subsystems and components for semiconductor capital equipment in the United States, the United Kingdom, Singapore, Malaysia, and South Korea. It primarily offers gas and chemical delivery subsystems that are used in the manufacturing of semiconductor devices. The company's gas delivery subsystems deliver, monitor, and control gases used in semiconductor manufacturing processes, such as etch and deposition; and chemical delivery subsystems blend and dispense the reactive liquid chemistries used in semiconductor manufacturing processes comprising electroplating and cleaning. It also manufactures precision machined components, weldments, and proprietary products for use in fluid delivery systems. Ichor Holdings, Ltd. was founded in 1999 and is headquartered in Fremont, California.

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