Rambus (NASDAQ:RMBS – Get Free Report) and Cohu (NASDAQ:COHU – Get Free Report) are both technology companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Rambus and Cohu, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Rambus | 0 | 4 | 6 | 0 | 2.60 |
| Cohu | 1 | 1 | 7 | 1 | 2.80 |
Rambus currently has a consensus target price of $145.88, indicating a potential upside of 38.72%. Cohu has a consensus target price of $68.75, indicating a potential upside of 2.61%. Given Rambus’ higher probable upside, analysts clearly believe Rambus is more favorable than Cohu.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Rambus | $756.33 million | 15.08 | $230.46 million | $2.18 | 48.24 |
| Cohu | $522.60 million | 6.07 | -$74.27 million | ($0.83) | -80.72 |
Rambus has higher revenue and earnings than Cohu. Cohu is trading at a lower price-to-earnings ratio than Rambus, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Rambus and Cohu’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Rambus | 31.69% | 17.89% | 16.21% |
| Cohu | -7.43% | -1.96% | -1.30% |
Volatility and Risk
Rambus has a beta of 1.88, suggesting that its share price is 88% more volatile than the S&P 500. Comparatively, Cohu has a beta of 1.58, suggesting that its share price is 58% more volatile than the S&P 500.
Institutional & Insider Ownership
88.5% of Rambus shares are owned by institutional investors. Comparatively, 94.7% of Cohu shares are owned by institutional investors. 0.7% of Rambus shares are owned by insiders. Comparatively, 3.0% of Cohu shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Summary
Rambus beats Cohu on 10 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 Cohu
Cohu, Inc., through its subsidiaries, provides semiconductor test equipment and services in China, the United States, Taiwan, Malaysia, the Philippines, and internationally. The company supplies semiconductor test and inspection handlers, micro-electromechanical system (MEMS) test modules, test contactors, thermal sub-systems, and semiconductor automated test equipment for semiconductor manufacturers and test subcontractors. It also provides semiconductor automated test equipment for wafer level and device package testing; various test handlers, including pick-and-place, turret, gravity, strip, and MEMS and thermal sub-systems; interface products comprising test contactors, and probe heads and pins; spares and kits; various parts and labor warranties on test and handling systems, and instruments; and training on the maintenance and operation of its systems, as well as application, data management software, and consulting services on its products. In addition, the company offers data analytics product that includes DI-Core, a software suite used to optimize Cohu equipment performance, which provides real-time online performance monitoring and process control. It markets its products through direct sales force and independent sales representatives. The company was formerly known as Cohu Electronics, Inc. and changed its name to Cohu, Inc. in 1972. The company was incorporated in 1947 and is headquartered in Poway, California.
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