NXP Semiconductors (NASDAQ:NXPI – Get Free Report) and Aehr Test Systems (NASDAQ:AEHR – Get Free Report) are both technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, risk, earnings, institutional ownership, analyst recommendations, profitability and dividends.
Volatility and Risk
NXP Semiconductors has a beta of 1.83, suggesting that its stock price is 83% more volatile than the S&P 500. Comparatively, Aehr Test Systems has a beta of 3.36, suggesting that its stock price is 236% more volatile than the S&P 500.
Profitability
This table compares NXP Semiconductors and Aehr Test Systems’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NXP Semiconductors | 23.40% | 28.57% | 11.87% |
| Aehr Test Systems | -14.25% | -3.83% | -3.36% |
Earnings and Valuation
This table compares NXP Semiconductors and Aehr Test Systems”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NXP Semiconductors | $12.27 billion | 5.44 | $2.02 billion | $12.72 | 20.83 |
| Aehr Test Systems | $50.00 million | 39.74 | -$7.13 million | ($0.24) | -253.50 |
NXP Semiconductors has higher revenue and earnings than Aehr Test Systems. Aehr Test Systems is trading at a lower price-to-earnings ratio than NXP Semiconductors, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of current recommendations and price targets for NXP Semiconductors and Aehr Test Systems, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NXP Semiconductors | 1 | 9 | 16 | 0 | 2.58 |
| Aehr Test Systems | 1 | 1 | 5 | 1 | 2.75 |
NXP Semiconductors currently has a consensus target price of $295.78, suggesting a potential upside of 11.61%. Aehr Test Systems has a consensus target price of $118.75, suggesting a potential upside of 95.18%. Given Aehr Test Systems’ stronger consensus rating and higher probable upside, analysts plainly believe Aehr Test Systems is more favorable than NXP Semiconductors.
Institutional and Insider Ownership
90.5% of NXP Semiconductors shares are owned by institutional investors. Comparatively, 69.7% of Aehr Test Systems shares are owned by institutional investors. 0.1% of NXP Semiconductors shares are owned by insiders. Comparatively, 4.6% of Aehr Test Systems shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Summary
NXP Semiconductors beats Aehr Test Systems on 8 of the 14 factors compared between the two stocks.
About NXP Semiconductors
NXP Semiconductors N.V. offers various semiconductor products. The company's product portfolio includes microcontrollers; application processors, including i.MX application processors, and i.MX 8 and 9 family of applications processors; communication processors; wireless connectivity solutions, such as near field communications, ultra-wideband, Bluetooth low-energy, Zigbee, and Wi-Fi and Wi-Fi/Bluetooth integrated SoCs; analog and interface devices; radio frequency power amplifiers; and security controllers, as well as semiconductor-based environmental and inertial sensors, including pressure, inertial, magnetic, and gyroscopic sensors. Its products are used in various applications, including automotive, industrial and Internet of Things, mobile, and communication infrastructure. The company markets its products to various original equipment manufacturers, contract manufacturers, and distributors. It operates in China, the Netherlands, the United States, Singapore, Germany, Japan, South Korea, Taiwan, and internationally. N.V. was incorporated in 2006 and is headquartered in Eindhoven, the Netherlands.
About Aehr Test Systems
Aehr Test Systems provides test solutions for testing, burning-in, and semiconductor devices in wafer level, singulated die, and package part form, and installed systems worldwide. Its product portfolio includes FOX-XP and FOX-NP systems that are full wafer contact and singulated die/module test and burn-in systems that can test, burn-in, and stabilize range of devices, including silicon carbide-based and other power semiconductors, 2D and 3D sensors used in mobile phones, tablets and other computing devices, memory semiconductors, processors, microcontrollers, systems-on-a-chip, and photonics and integrated optical devices. The company also offers FOX-CP system, a low-cost single-wafer compact test solution for logic, memory, and photonic devices; FOX WaferPak Contactor, a full wafer contactor capable of testing wafers up to 300mm that enables integrated circuit manufacturers to perform test, burn-in, and stabilization of full wafers on the FOX-P systems. In addition, it provides FOX DiePak Carrier, a reusable temporary package that enables IC manufacturers to perform final test and burn-in of bare die and modules; and FOX DiePak Loader. The company was incorporated in 1977 and is headquartered in Fremont, California.
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