Analyzing Microchip Technology (NASDAQ:MCHP) & Infineon Technologies (OTCMKTS:IFNNF)

Microchip Technology (NASDAQ:MCHP) and Infineon Technologies (OTCMKTS:IFNNF) are both computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, institutional ownership, analyst recommendations, risk and profitability.

Institutional & Insider Ownership

91.5% of Microchip Technology shares are held by institutional investors. Comparatively, 44.8% of Infineon Technologies shares are held by institutional investors. 2.1% of Microchip Technology shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Microchip Technology and Infineon Technologies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Microchip Technology	0	4	15	0	2.79
Infineon Technologies	0	0	0	0	N/A

Microchip Technology currently has a consensus target price of $99.95, suggesting a potential upside of 23.42%. Given Microchip Technology’s higher possible upside, equities analysts clearly believe Microchip Technology is more favorable than Infineon Technologies.

Valuation & Earnings

This table compares Microchip Technology and Infineon Technologies’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Microchip Technology	$6.59 billion	6.60	$1.91 billion	$3.47	23.34
Infineon Technologies	N/A	N/A	N/A	$0.48	75.00

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

Profitability

This table compares Microchip Technology and Infineon Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Microchip Technology	20.80%	27.82%	11.85%
Infineon Technologies	N/A	N/A	N/A

Summary

Microchip Technology beats Infineon Technologies on 9 of the 10 factors compared between the two stocks.

About Microchip Technology

Microchip Technology Incorporated engages in the development, manufacture, and sale of smart, connected, and secure embedded control solutions in the Americas, Europe, and Asia. The company offers general purpose 8-bit, 16-bit, and 32-bit mixed-signal microcontrollers; 32-bit embedded mixed-signal microprocessors; and specialized microcontrollers for automotive, industrial, computing, communications, lighting, power supplies, motor control, human machine interface, security, wired connectivity, and wireless connectivity applications. It also provides analog, interface, mixed signal, and timing products comprising power management, linear, mixed-signal, high-voltage, thermal management, discrete diodes, and metal oxide semiconductor field effect transistors (MOSFETS), radio frequency (RF), drivers, safety, security, timing, USB, Ethernet, wireless, and other interface products; field-programmable gate array (FPGA) products; and application development tools that enable system designers to program microcontroller, FPGA, and microprocessor products for specific applications. In addition, the company offers serial electrically erasable programmable read-only memory, serial flash memories, parallel flash memories, serial static random access memories, and serial electrically erasable random access memories for the production of very small footprint devices; and licenses its SuperFlash embedded flash and non-volatile memory technologies to foundries, integrated device manufacturers, and design partners for use in the manufacture of microcontroller products, gate array, RF, analog, and neuromorphic compute products that require embedded non-volatile memory, as well as provides engineering services. Further, it offers wafer foundry and assembly, and test subcontracting manufacturing services; and timing systems products, application specific integrated circuits, and aerospace products. The company was incorporated in 1989 and is headquartered in Chandler, Arizona.

About Infineon Technologies

Infineon Technologies AG designs, develops, manufactures, and markets semiconductors and semiconductor-based solutions worldwide. Its Automotive segment offers automotive microcontrollers; 3D ToF, magnetic, and pressure sensors; discrete power semiconductors; IGBT modules; industrial microcontrollers; power and memory ICs; transceivers; diodes, MOSEFTs, and modules; and voltage regulators for use in assistance and safety systems, comfort electronics, infotainment, powertrain, and security products. The company's Green Industrial Power segment provides bare dies, discrete IGBTs, and driver ICs; SiC diodes, MOSFETs, and modules; and IGBT modules for home appliances, industrial drives, industrial power supplies, industrial robotics, industrial vehicles, and traction, as well as for energy generation, storage, and transmission. Its Power & Sensor Systems segment offers chips for gas and pressure sensors, and MEMS microphones; 3D ToF sensors; control ICs; discrete low-, mid-, and high-voltage power MOSFET; customized chips; GaN power switches; GPS low-noise amplifiers; low-voltage and high-voltage driver ICs; radar sensor ICs; RF antenna switches and power transistors; transient voltage suppressor diodes; SiC diode and MOSFETs; and USB controllers for use in audio amplifiers, automotive electronics, BLDC motors, cellular communications infrastructure, electric vehicle charging stations, human machine interaction, IoT, LED and conventional lighting systems, microinverter, mobile devices, power management, and special applications. The company's Connected Secure Systems segment provides connectivity solutions, embedded security controllers, microcontrollers, and security controllers for authentication, automotive, consumer electronics, government identification document, IoT, mobile communication, payment system, ticketing, access control, and computing applications. Infineon Technologies AG was founded in 1999 and is headquartered in Neubiberg, Germany.