KLA (NASDAQ:KLAC) versus Arbe Robotics (NASDAQ:ARBE) Critical Contrast

KLA (NASDAQ:KLAC) and Arbe Robotics (NASDAQ:ARBE) are both technology companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, analyst recommendations, valuation, risk and profitability.

Institutional & Insider Ownership

86.7% of KLA shares are held by institutional investors. Comparatively, 33.4% of Arbe Robotics shares are held by institutional investors. 79.4% of KLA shares are held by company insiders. Comparatively, 53.5% of Arbe Robotics shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares KLA and Arbe Robotics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KLA	35.57%	87.66%	29.23%
Arbe Robotics	-2,116.84%	-90.93%	-54.71%

Volatility and Risk

KLA has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500. Comparatively, Arbe Robotics has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for KLA and Arbe Robotics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KLA	0	10	19	0	2.66
Arbe Robotics	1	0	2	0	2.33

KLA presently has a consensus price target of $221.26, suggesting a potential upside of 51.95%. Arbe Robotics has a consensus price target of $2.75, suggesting a potential upside of 536.72%. Given Arbe Robotics’ higher probable upside, analysts plainly believe Arbe Robotics is more favorable than KLA.

Valuation & Earnings

This table compares KLA and Arbe Robotics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KLA	$13.58 billion	13.99	$4.83 billion	$3.67	39.68
Arbe Robotics	$1.03 million	53.38	-$46.42 million	($0.34)	-1.27

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

Summary

KLA beats Arbe Robotics on 12 of the 14 factors compared between the two stocks.

About KLA

KLA Corporation, together with its subsidiaries, engages in the design, manufacture, and marketing of process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through three segments: Semiconductor Process Control; Specialty Semiconductor Process; and PCB and Component Inspection. The company offers inspection and review tools to identify, locate, characterize, review, and analyze defects on various surfaces of patterned and unpatterned wafers; metrology systems that are used to measure pattern dimensions, film thickness, film stress, layer-to-layer alignment, pattern placement, surface topography, and electro-optical properties for wafers; chemical process control equipment; wired and wireless sensor wafers and reticles; wafer defect inspection, review, and metrology systems; reticle inspection and metrology systems; and semiconductor software solutions that provide run-time process control, defect excursion identification, process corrections, and defect classification to accelerate yield learning rates and reduce production risk. It also provides etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, inkjet and additive printing, UV laser drilling, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.

About Arbe Robotics

Arbe Robotics Ltd., a semiconductor company, provides 4D imaging radar solutions for tier 1 automotive suppliers and automotive manufacturers in China, Hong Kong, Sweden, Germany, the United States, Israel, and internationally. It offers 4D imaging radar chipset solutions that address the core issues that have caused autonomous vehicle and autopilot accidents, such as detecting stationary objects, identifying vulnerable road users, operation at poor lighting conditions, and eliminating false alarms without radar ambiguities. The company was founded in 2015 and is headquartered in Tel Aviv-Yafo, Israel.