Analyzing Intel Corporation (INTC) & AXT (AXTI)

Intel Corporation (NASDAQ: INTC) and AXT (NASDAQ:AXTI) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Profitability

This table compares Intel Corporation and AXT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Intel Corporation 20.60% 21.86% 12.50%
AXT 8.15% 4.61% 4.10%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Intel Corporation and AXT, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Intel Corporation 4 14 25 0 2.49
AXT 0 1 4 0 2.80

Intel Corporation currently has a consensus target price of $40.69, indicating a potential upside of 9.96%. AXT has a consensus target price of $9.10, indicating a potential upside of 3.41%. Given Intel Corporation’s higher probable upside, analysts clearly believe Intel Corporation is more favorable than AXT.

Dividends

Intel Corporation pays an annual dividend of $1.09 per share and has a dividend yield of 2.9%. AXT does not pay a dividend. Intel Corporation pays out 41.8% of its earnings in the form of a dividend. AXT has raised its dividend for 2 consecutive years.

Insider & Institutional Ownership

67.1% of Intel Corporation shares are owned by institutional investors. Comparatively, 61.9% of AXT shares are owned by institutional investors. 0.1% of Intel Corporation shares are owned by company insiders. Comparatively, 6.9% of AXT shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Intel Corporation and AXT’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Intel Corporation $61.71 billion 2.82 $24.70 billion $2.61 14.18
AXT $86.31 million 3.91 $13.40 million $0.20 44.00

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

Volatility & Risk

Intel Corporation has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500. Comparatively, AXT has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500.

Summary

Intel Corporation beats AXT on 10 of the 17 factors compared between the two stocks.

About Intel Corporation

Intel Corporation is engaged in designing and manufacturing products and technologies, such as the cloud. The Company’s segments are Client Computing Group (CCG), Data Center Group (DCG), Internet of Things Group (IOTG), Non-Volatile Memory Solutions Group (NSG), Intel Security Group (ISecG), Programmable Solutions Group (PSG), All Other and New Technology Group (NTG). It delivers computer, networking and communications platforms to a set of customers, including original equipment manufacturers (OEMs), original design manufacturers (ODMs), cloud and communications service providers, as well as industrial, communications and automotive equipment manufacturers. It offers platforms to integrate various components and technologies, including a microprocessor and chipset, a stand-alone System-on-Chip (SoC), or a multichip package. The CCG operating segment includes platforms that integrates in notebook, two in one systems, desktop computers for consumers and businesses, tablets, and phones.

About AXT

AXT, Inc. (AXT) is a developer and producer of compound and single element semiconductor substrates, also known as wafers. The dominant substrates used in producing semiconductor chips and other electronic circuits are made from silicon. The Company is engaged in the design, development, manufacture and distribution of compound semiconductor substrates and sale of materials. The Company provides alternative or specialty materials in the form of substrates or wafers, including compound and single element substrates. Its compound substrates combine indium with phosphorous (InP) or gallium with arsenic (GaAs). Its single element substrates are made from germanium (Ge). The Company uses its Vertical Gradient Freeze (VGF) technique for growing single crystal Indium Phosphide (InP), Gallium Arsenide (GaAs) and Germanium (Ge) ingots used to produce wafers for diverse electronic and optoelectronic device and circuit applications.

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