Critical Contrast: Broadcom (NASDAQ:AVGO) vs. EMCORE (NASDAQ:EMKR)

Broadcom (NASDAQ:AVGOGet Free Report) and EMCORE (NASDAQ:EMKRGet Free Report) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, earnings and analyst recommendations.

Volatility & Risk

Broadcom has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500. Comparatively, EMCORE has a beta of 1.51, suggesting that its share price is 51% more volatile than the S&P 500.

Valuation and Earnings

This table compares Broadcom and EMCORE”s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Broadcom $46.82 billion 17.15 $14.08 billion $23.25 7.42
EMCORE $90.96 million 0.20 -$75.36 million ($8.70) -0.25

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

Profitability

This table compares Broadcom and EMCORE’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Broadcom 10.88% 30.12% 11.66%
EMCORE -81.08% -25.05% -13.56%

Institutional and Insider Ownership

76.4% of Broadcom shares are owned by institutional investors. Comparatively, 65.7% of EMCORE shares are owned by institutional investors. 2.0% of Broadcom shares are owned by insiders. Comparatively, 0.9% of EMCORE shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Broadcom and EMCORE, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Broadcom 0 1 24 1 3.00
EMCORE 0 3 0 0 2.00

Broadcom presently has a consensus price target of $189.23, indicating a potential upside of 9.70%. EMCORE has a consensus price target of $1.00, indicating a potential downside of 54.75%. Given Broadcom’s stronger consensus rating and higher probable upside, equities analysts plainly believe Broadcom is more favorable than EMCORE.

Summary

Broadcom beats EMCORE on 14 of the 15 factors compared between the two stocks.

About Broadcom

(Get Free Report)

Broadcom Inc. designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software. It provides set-top box system-on-chips (SoCs); cable, digital subscriber line, and passive optical networking central office/consumer premise equipment SoCs; wireless local area network access point SoCs; Ethernet switching and routing custom silicon solutions; serializer/deserializer application specific integrated circuits; optical and copper, and physical layer devices; and fiber optic components and RF semiconductor devices. The company also offers RF front end modules and filter; Wi-Fi, Bluetooth, and global positioning system/global navigation satellite system SoCs; custom touch controllers; inductive charging; attached small computer system interface, and redundant array of independent disks controllers and adapters; peripheral component interconnect express; fiber channel host bus adapters; read channel based SoCs; custom flash controllers; preamplifiers; optocouplers, industrial fiber optics, and motion control encoders and subsystems; light emitting diode, ethernet PHYs, switch ICs, and camera microcontrollers. Its products are used in various applications, including enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. Broadcom Inc. was founded in 1961 and is headquartered in Palo Alto, California.

About EMCORE

(Get Free Report)

EMCORE Corporation, together with its subsidiaries, designs and manufactures fiber optic gyro, ring laser gyro, and micro electromechanical system-based inertial sensors and systems in the United States and internationally. It offers navigation system and inertial sensing products, such as gyroscopes and multi-axis sensors, inertial measurement units, fiber optic gyroscopes, quartz micro electromechanical systems, inertial navigation systems, tactical navigation, and naval and amphibious navigation, as well as radar positioning and pointing systems, and battlefield/artillery survey systems. The company sells its products through direct sales force, application engineers, third-party sales representatives, and distributors. EMCORE Corporation was founded in 1984 and is headquartered in Alhambra, California.

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