GSI Technology (NASDAQ:GSIT) and Kulicke and Soffa Industries (NASDAQ:KLIC) Financial Analysis

GSI Technology (NASDAQ:GSIT) and Kulicke and Soffa Industries (NASDAQ:KLIC) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Dividends

Kulicke and Soffa Industries pays an annual dividend of $0.48 per share and has a dividend yield of 2.1%. GSI Technology does not pay a dividend. Kulicke and Soffa Industries pays out 19.8% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current recommendations and price targets for GSI Technology and Kulicke and Soffa Industries, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
GSI Technology 0 1 0 0 2.00
Kulicke and Soffa Industries 0 2 2 0 2.50

Kulicke and Soffa Industries has a consensus target price of $26.50, suggesting a potential upside of 15.57%. Given Kulicke and Soffa Industries’ stronger consensus rating and higher probable upside, analysts plainly believe Kulicke and Soffa Industries is more favorable than GSI Technology.

Institutional & Insider Ownership

32.0% of GSI Technology shares are held by institutional investors. Comparatively, 91.9% of Kulicke and Soffa Industries shares are held by institutional investors. 35.5% of GSI Technology shares are held by insiders. Comparatively, 1.8% of Kulicke and Soffa Industries shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

GSI Technology has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500. Comparatively, Kulicke and Soffa Industries has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.

Profitability

This table compares GSI Technology and Kulicke and Soffa Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
GSI Technology 3.16% 1.83% 1.60%
Kulicke and Soffa Industries 5.96% 6.21% 4.60%

Earnings & Valuation

This table compares GSI Technology and Kulicke and Soffa Industries’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
GSI Technology $51.49 million 3.37 $160,000.00 N/A N/A
Kulicke and Soffa Industries $889.12 million 1.64 $56.67 million $2.43 9.44

Kulicke and Soffa Industries has higher revenue and earnings than GSI Technology.

Summary

Kulicke and Soffa Industries beats GSI Technology on 10 of the 15 factors compared between the two stocks.

About GSI Technology

GSI Technology, Inc., a fabless semiconductor company, designs, develops, and markets memory products primarily for the networking and telecommunications markets in the United States, China, Singapore, the Netherlands, and internationally. It offers synchronous static random access memory (SRAM) products, such as BurstRAMs for microprocessor cache applications; No Bus Turnaround SRAMs to address the needs of moderate performance networking applications; SigmaQuad and SigmaDDR products that are double data rate and quad data rate synchronous SRAMs; and radiation-hardened SRAMs for aerospace and military applications, such as networking satellites and missiles. The company also provides low latency dynamic random access memory products. Its products are incorporated in a range of networking and telecommunications equipment, including core routers, multi-service access routers, universal gateways, enterprise edge routers, service provider edge routers, optical edge routers, fast Ethernet switches, wireless base stations, and network access equipment. The company markets its products through a network of independent sales representatives and distributors to original equipment manufacturers, as well as to military, industrial, test and measurement equipment, automotive, and medical markets. GSI Technology, Inc. was founded in 1995 and is headquartered in Sunnyvale, California.

About Kulicke and Soffa Industries

Kulicke and Soffa Industries, Inc. designs, manufactures, and sells capital equipment and tools to assemble semiconductor devices. It operates in two segments, Capital Equipment, and Aftermarket Products and Services (APS). The Capital Equipment segment manufactures and sells a line of ball bonders, wedge bonders, advanced packaging, and electronic assembly solutions. The APS segment manufactures and sells various tools for a range of semiconductor packaging applications, including capillaries, which are expendable tools used in ball bonders; dicing blades that are expendable tools for semiconductor manufacturers to cut silicon wafers into individual semiconductor die or to cut packaged semiconductor units into individual units; and bonding wedges, which are expendable tools used in heavy wire wedge bonders. It also provides spare parts, equipment repair, maintenance and servicing, training, refurbishment, and equipment upgradation services. The company serves semiconductor device manufacturers, integrated device manufacturers, outsourced semiconductor assembly and test providers, other electronics manufacturers, industrial manufacturers, and automotive electronics suppliers primarily in the United States and the Asia/Pacific region. Kulicke and Soffa Industries, Inc. was founded in 1951 and is headquartered in Singapore.

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