Comparing Diodes (NASDAQ:DIOD) & First Solar (NASDAQ:FSLR)

Diodes (NASDAQ:DIOD) and First Solar (NASDAQ:FSLR) are both technology companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, dividends, earnings, valuation, profitability, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings for Diodes and First Solar, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diodes	0	1	3	1	3.00
First Solar	2	11	23	1	2.62

Diodes presently has a consensus target price of $135.00, indicating a potential upside of 30.01%. First Solar has a consensus target price of $266.23, indicating a potential upside of 52.47%. Given First Solar’s higher probable upside, analysts clearly believe First Solar is more favorable than Diodes.

Insider & Institutional Ownership

99.2% of Diodes shares are held by institutional investors. Comparatively, 92.1% of First Solar shares are held by institutional investors. 1.7% of Diodes shares are held by insiders. Comparatively, 0.4% of First Solar shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

Diodes has a beta of 1.9, meaning that its stock price is 90% more volatile than the S&P 500. Comparatively, First Solar has a beta of 1.8, meaning that its stock price is 80% more volatile than the S&P 500.

Profitability

This table compares Diodes and First Solar’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diodes	5.27%	4.33%	3.41%
First Solar	32.47%	18.02%	13.05%

Valuation and Earnings

This table compares Diodes and First Solar”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diodes	$1.63 billion	2.93	$66.14 million	$1.85	56.13
First Solar	$5.22 billion	3.59	$1.53 billion	$16.22	10.77

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

Summary

First Solar beats Diodes on 9 of the 14 factors compared between the two stocks.

About Diodes

Diodes Incorporated, together with its subsidiaries, manufactures and supplies application-specific standard products in the broad discrete, logic, analog, and mixed-signal semiconductor markets worldwide. The company offers discrete semiconductor products, such as MOSFETs, SiC MOSFETs; data line protection, power line protection, thyristers, USB Type-C protection, and transient voltage suppressors; Schottky, small signal switching, Zener, and SiC diodes; bridges, super barrier, Schottky, Schottky bridge, and fast/ultra-fast rectifiers; and bipolar, avalanche, gate driver, and pre-bias transistors. It also provides analog products, including power management devices comprising AC-DC and DC-DC converters, USB power switches, low dropout, photocoupler and linear voltage regulators; standard linear devices consisting of operational amplifiers and comparators, current monitors, voltage references, and reset generators; LED lighting drivers; audio amplifiers; and sensor products, such as hall-effect sensors and motor drivers. In addition, the company offers mixed-signal products, such as high speed mux/demux, digital switches, interface, redrivers, universal level shifters/voltage translators, clock ICs and packet switches; standard logic products comprising low-voltage complementary metal-oxide-semiconductor (CMOS) and advanced high-speed CMOS devices; ultra-low power CMOS logic; and analog switches; multichip products and co-packaged discrete, analog and mixed-signal silicon in miniature packages; and silicon and silicon epitaxial wafers used in manufacturing frequency control products and contact images sensors. It serves the industrial, automotive, computing, communications, and consumer markets through direct sales, marketing personnel, independent sales representatives, and distributors. The company was incorporated in 1959 and is headquartered in Plano, Texas.

About First Solar

First Solar, Inc., a solar technology company, provides photovoltaic (PV) solar energy solutions in the United States, France, Japan, Chile, and internationally. The company manufactures and sells PV solar modules with a thin film semiconductor technology that provides a lower-carbon alternative to conventional crystalline silicon PV solar modules. It designs, manufactures, and sells cadmium telluride solar modules that converts sunlight into electricity. The company's residual business operations include project development activities, operations and maintenance services, and the sale of PV solar power systems to third-party customers. It serves developers and operators of systems, utilities, independent power producers, commercial and industrial companies, and other system owners. The company was formerly known as First Solar Holdings, Inc. and changed its name to First Solar, Inc. in 2006. First Solar, Inc. was founded in 1999 and is headquartered in Tempe, Arizona.