Reviewing Valens Semiconductor (NYSE:VLN) & Rambus (NASDAQ:RMBS)

Rambus (NASDAQ:RMBS) and Valens Semiconductor (NYSE:VLN) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, earnings, risk, analyst recommendations and institutional ownership.

Volatility and Risk

Rambus has a beta of 1.47, indicating that its stock price is 47% more volatile than the S&P 500. Comparatively, Valens Semiconductor has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.

Profitability

This table compares Rambus and Valens Semiconductor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rambus	33.72%	17.73%	15.20%
Valens Semiconductor	-44.38%	-23.12%	-18.88%

Insider & Institutional Ownership

88.5% of Rambus shares are held by institutional investors. Comparatively, 33.9% of Valens Semiconductor shares are held by institutional investors. 1.0% of Rambus shares are held by insiders. Comparatively, 58.9% of Valens Semiconductor shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Rambus and Valens Semiconductor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rambus	0	1	6	3	3.20
Valens Semiconductor	1	0	1	1	2.67

Rambus currently has a consensus target price of $108.14, suggesting a potential upside of 17.68%. Valens Semiconductor has a consensus target price of $3.00, suggesting a potential upside of 98.02%. Given Valens Semiconductor’s higher probable upside, analysts clearly believe Valens Semiconductor is more favorable than Rambus.

Earnings and Valuation

This table compares Rambus and Valens Semiconductor”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rambus	$678.49 million	14.58	$179.82 million	$2.11	43.55
Valens Semiconductor	$57.86 million	2.68	-$36.58 million	($0.29)	-5.22

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

Summary

Rambus beats Valens Semiconductor on 13 of the 15 factors compared between the two stocks.

About Rambus

Rambus Inc. provides semiconductor products in the United States, South Korea, Singapore, and internationally. The company offers DDR memory interface chips, including DDR5 and DDR4 memory interface chips to module manufacturers, OEMs, and hyperscalers; silicon IP, such as interface and security IP solutions that move and protect data in advanced data center, government, and automotive applications; and interface IP solutions for high-speed memory and chip-to-chip digital controller IP. It also provides a portfolios of security IP solutions, including crypto cores, hardware roots of trust, high-speed protocol engines, and chip provisioning technologies; and portfolio of patents that covers memory architecture, high-speed serial links, and security products. It markets its products and services through its direct sales force and distributors. Rambus Inc. was incorporated in 1990 and is headquartered in San Jose, California.

About Valens Semiconductor

Valens Semiconductor Ltd. engages in the provision of semiconductor products for the audio-video and automotive industries. The company offers HDBaseT technology, which enables the simultaneous delivery of ultra-high-definition digital video and audio, Ethernet, USB, control signals, and power through a single long-reach cable. It also provides audio-video solutions for the enterprise, education, industrial, digital signage, industrial, and medical markets. In addition, it offers automotive chipsets that support advanced driver-assistance systems, automotive data solutions, infotainment, telematics, and backbone connectivity. The company’s product series include VS100, VS2000, VS3000, VS6000, VS7000, Valens USB and power extender, Valens VS6320, USB 3.2 Gen1 extension chipset, VA6000, and VA7000. It has a collaboration with iCatch Technology to develop a 360-degree multi-camera videoconferencing solution. The company operates in Israel, China, Hong Kong, the United States, Japan, Germany, Hungary, and internationally. Valens Semiconductor Ltd. is headquartered in Hod Hasharon, Israel.