Applied Materials (NASDAQ:AMAT – Get Free Report) and Aeluma (NASDAQ:ALMU – Get Free Report) are both technology companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.
Insider and Institutional Ownership
80.6% of Applied Materials shares are held by institutional investors. 0.3% of Applied Materials shares are held by insiders. Comparatively, 12.8% of Aeluma shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Applied Materials and Aeluma’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Applied Materials | 30.05% | 38.02% | 22.09% |
| Aeluma | -205.31% | -18.14% | -17.20% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Applied Materials | $28.37 billion | 12.49 | $7.00 billion | $11.60 | 38.50 |
| Aeluma | $4.46 million | 39.51 | -$9.16 million | ($0.52) | -17.54 |
Applied Materials has higher revenue and earnings than Aeluma. Aeluma is trading at a lower price-to-earnings ratio than Applied Materials, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent recommendations for Applied Materials and Aeluma, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Applied Materials | 0 | 8 | 30 | 1 | 2.82 |
| Aeluma | 1 | 0 | 3 | 1 | 2.80 |
Applied Materials presently has a consensus price target of $640.20, indicating a potential upside of 43.34%. Aeluma has a consensus price target of $25.00, indicating a potential upside of 174.12%. Given Aeluma’s higher probable upside, analysts plainly believe Aeluma is more favorable than Applied Materials.
Volatility and Risk
Applied Materials has a beta of 1.6, indicating that its share price is 60% more volatile than the S&P 500. Comparatively, Aeluma has a beta of 4.1, indicating that its share price is 310% more volatile than the S&P 500.
Summary
Applied Materials beats Aeluma on 9 of the 13 factors compared between the two stocks.
About Applied Materials
Applied Materials, Inc. engages in the provision of manufacturing equipment, services, and software to the semiconductor, display, and related industries. The company operates through three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets. The Semiconductor Systems segment develops, manufactures, and sells various manufacturing equipment that is used to fabricate semiconductor chips or integrated circuits. This segment also offers various technologies, including epitaxy, ion implantation, oxidation/nitridation, rapid thermal processing, physical vapor deposition, chemical vapor deposition, chemical mechanical planarization, electrochemical deposition, atomic layer deposition, etching, and selective deposition and removal, as well as metrology and inspection tools. The Applied Global Services segment provides integrated solutions to optimize equipment and fab performance and productivity comprising spares, upgrades, services, remanufactured earlier generation equipment, and factory automation software for semiconductor, display, and other products. The Display and Adjacent Markets segment offers products for manufacturing liquid crystal displays; organic light-emitting diodes; and other display technologies for TVs, monitors, laptops, personal computers, electronic tablets, smart phones, and other consumer-oriented devices. It operates in the United States, China, Korea, Taiwan, Japan, Southeast Asia, and Europe. The company was incorporated in 1967 and is headquartered in Santa Clara, California.
About Aeluma
Aeluma, Inc. develops optoelectronic and electronic devices in the United States. The company manufactures semiconductor materials and chips using compound semiconductors on diameter substrates that are used to manufacture mass market microelectronics. It offers its devices for use in mobile, automotive, AI, defence and aerospace, communication, AR/VR, and HPC applications, as well as laser emitters, transistors for integrated circuits, quantum photonic circuits, and solar cells applications. Aeluma, Inc. was formerly known as Parc Investments, Inc. and changed its name to Aeluma, Inc. June 2021. The company was founded in 2019 and is headquartered in Goleta, California.
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