Tower Semiconductor (NASDAQ:TSEM – Get Free Report) and Rohm (OTCMKTS:ROHCY – Get Free Report) are both technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, analyst recommendations, dividends, earnings and profitability.
Institutional and Insider Ownership
70.5% of Tower Semiconductor shares are held by institutional investors. 1.0% of Tower Semiconductor shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Tower Semiconductor and Rohm’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Tower Semiconductor | 16.94% | 9.83% | 8.25% |
| Rohm | -29.85% | 4.39% | 2.70% |
Valuation and Earnings
This table compares Tower Semiconductor and Rohm”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Tower Semiconductor | $1.57 billion | 12.03 | $220.47 million | $2.53 | 66.23 |
| Rohm | $3.20 billion | 2.87 | -$1.05 billion | ($2.57) | -9.25 |
Tower Semiconductor has higher earnings, but lower revenue than Rohm. Rohm is trading at a lower price-to-earnings ratio than Tower Semiconductor, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Tower Semiconductor has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500. Comparatively, Rohm has a beta of 1.36, suggesting that its stock price is 36% more volatile than the S&P 500.
Analyst Ratings
This is a summary of current ratings and recommmendations for Tower Semiconductor and Rohm, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Tower Semiconductor | 0 | 2 | 7 | 1 | 2.90 |
| Rohm | 0 | 1 | 1 | 0 | 2.50 |
Tower Semiconductor currently has a consensus price target of $316.00, indicating a potential upside of 88.59%. Given Tower Semiconductor’s stronger consensus rating and higher possible upside, research analysts plainly believe Tower Semiconductor is more favorable than Rohm.
Summary
Tower Semiconductor beats Rohm on 13 of the 15 factors compared between the two stocks.
About Tower Semiconductor
Tower Semiconductor Ltd., an independent semiconductor foundry, focus on specialty process technologies to manufacture analog intensive mixed-signal semiconductor devices in Israel, the United States, Japan, Europe, and internationally. It provides various customizable process technologies, including SiGe, BiCMOS, mixed signal/CMOS, RF CMOS, CMOS image sensor, integrated power management, and MEMS. The Company also provides design enablement platform for quick and accurate design cycle, as well as transfer optimization and development process services to integrated device manufacturers and fabless companies. It serves various markets, such as consumer electronics, personal computers, communications, automotive, industrial, aerospace, military, and medical device products. The company was incorporated in 1993 and is headquartered in Migdal Haemek, Israel.
About Rohm
ROHM Co., Ltd. manufactures and sells electronic components worldwide. The company operates through three segments: LSI, Semiconductor Devices, and Modules. It provides ICs comprising memory, amplifiers and linear, power management, motor/actuator drivers, resistors, clocks and timers, switches and multiplexers, logic, data converters, sensors and MEMS, display drivers, interfaces, wireless LSIs, audio and video products, speech synthesis LSI, and microcontrollers. The company also offers discrete semiconductor products, such as MOSFETs, bipolar transistors, and diodes; power devices, including power transistors and diodes, SiC power devices, IGBT, and IPM; modules, including optical modules, wireless communication modules, wireless charger modules, and print heads; and opto devices comprising LEDs, LED displays, laser diodes, and optical sensors, as well as foundry services, including thin-film piezoelectric MEMS, wafers, and WL-CSP. Its products are used in industry, automotive, consumer electronics, and telecommunications applications. The company was incorporated in 1940 and is headquartered in Kyoto, Japan.
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