Head-To-Head Analysis: NXP Semiconductors (NXPI) and Benchmark Electronics (NYSE:BHE)

NXP Semiconductors (NASDAQ: NXPI) and Benchmark Electronics (NYSE:BHE) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations and price targets for NXP Semiconductors and Benchmark Electronics, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NXP Semiconductors 0 13 0 1 2.14
Benchmark Electronics 0 3 0 0 2.00

NXP Semiconductors currently has a consensus target price of $118.13, suggesting a potential upside of 0.96%. Benchmark Electronics has a consensus target price of $36.67, suggesting a potential upside of 23.04%. Given Benchmark Electronics’ higher possible upside, analysts plainly believe Benchmark Electronics is more favorable than NXP Semiconductors.

Insider and Institutional Ownership

82.6% of NXP Semiconductors shares are held by institutional investors. Comparatively, 98.0% of Benchmark Electronics shares are held by institutional investors. 0.9% of Benchmark Electronics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares NXP Semiconductors and Benchmark Electronics’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NXP Semiconductors $9.26 billion 4.34 $2.22 billion $6.41 18.25
Benchmark Electronics $2.47 billion 0.59 -$31.96 million ($0.66) -45.15

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

Profitability

This table compares NXP Semiconductors and Benchmark Electronics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NXP Semiconductors 23.93% 18.68% 10.24%
Benchmark Electronics -1.30% 5.83% 3.90%

Risk & Volatility

NXP Semiconductors has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, Benchmark Electronics has a beta of 0.39, indicating that its stock price is 61% less volatile than the S&P 500.

Summary

NXP Semiconductors beats Benchmark Electronics on 11 of the 14 factors compared between the two stocks.

NXP Semiconductors Company Profile

NXP Semiconductors N.V., a semiconductor company, provides high performance mixed signal and standard product solutions for radio frequency (RF), analog, power management, interface, security, and digital processing products worldwide. It offers products for audio and visual head-end unit applications, such as single-chip radio solutions, audio amplifiers and power analog products, and i.MX applications processors; and in-vehicle networking products, two-way secure entry products, and various sensors and microcontrollers, as well as power management solutions. The company also provides secure identification solutions comprising passive RF connectivity devices; microcontroller devices; and secure real-time operating system software products to facilitate the encryption-decryption of data, and the interaction with the reader infrastructure systems. In addition, it delivers semiconductor-based technologies for connected devices, including microcontrollers, as well as secure mobile transaction solutions and various connectivity solutions; and offers digital networking processors, secure interface and system management products, high-performance RF power-amplifiers, and smart antennae solutions. Further, the company provides standard semiconductor components, such as small signal discretes, power discretes, protection and signal conditioning devices, and standard logic devices. Its product solutions are used in a range of application areas, including automotive, identification, wireless infrastructure, lighting, industrial, mobile, consumer, computing, and software solutions for mobile phones. NXP Semiconductors N.V. markets its products to various original equipment manufacturers, original design manufacturers, contract manufacturers, and distributors. The company was formerly known as KASLION Acquisition B.V and changed its name to NXP Semiconductors N.V. in May 2010. NXP Semiconductors N.V. was founded in 2006 and is headquartered in Eindhoven, the Netherlands.

Benchmark Electronics Company Profile

Benchmark Electronics, Inc. is a provider of electronic manufacturing services. The Company operates through three segments: the Americas, Asia and Europe. It provides services to original equipment manufacturers of industrial control equipment, including equipment for the aerospace and defense industry; telecommunication equipment; computers and related products for business enterprises; medical devices, and testing and instrumentation products. It offers integrated design and manufacturing services. Its operations consist of over three principal areas: manufacturing and assembly operations, including printed circuit boards assemblies and subsystem assembly, box build and systems integration; precision technology manufacturing, which include precision machining, metal joining, assembly and functional testing, and specialized engineering services, and specialized engineering services, such as product design, printed circuit board layout, prototyping, automation and test development.

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