Analyzing Sigma Lithium (NASDAQ:SGML) and Tokyo Electron (OTCMKTS:TOELY)

Tokyo Electron (OTCMKTS:TOELY) and Sigma Lithium (NASDAQ:SGML) 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, valuation, analyst recommendations, dividends, risk, institutional ownership and earnings.

Profitability

This table compares Tokyo Electron and Sigma Lithium’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tokyo Electron	21.07%	23.86%	17.69%
Sigma Lithium	-24.13%	-35.97%	-9.94%

Institutional and Insider Ownership

1.3% of Tokyo Electron shares are held by institutional investors. Comparatively, 64.9% of Sigma Lithium shares are held by institutional investors. 48.6% of Sigma Lithium shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Tokyo Electron and Sigma Lithium, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tokyo Electron	0	1	0	0	2.00
Sigma Lithium	2	2	2	0	2.00

Sigma Lithium has a consensus target price of $17.50, indicating a potential upside of 38.97%. Given Sigma Lithium’s higher possible upside, analysts plainly believe Sigma Lithium is more favorable than Tokyo Electron.

Valuation and Earnings

This table compares Tokyo Electron and Sigma Lithium”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tokyo Electron	$15.97 billion	8.39	$3.59 billion	$3.66	38.80
Sigma Lithium	$134.54 million	10.43	-$51.07 million	($0.31)	-40.62

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

Summary

Tokyo Electron beats Sigma Lithium on 7 of the 12 factors compared between the two stocks.

About Tokyo Electron

Tokyo Electron Limited, together with its subsidiaries, develops, manufactures, and sells semiconductor and flat panel display (FPD) production equipment in Japan, Europe, North America, Taiwan, China, South Korea, Southeast Asia, and internationally. The company offers coaters/developers, etch systems, surface preparation systems, deposition systems, test systems, wafer bonders/debonders, wafer edge trimming, SiC epitaxial CVD systems, gas cluster ion beam system, and cleaning systems. It also provides plasma etch/ash systems for use in the manufacture of FPDs, as well as inkjet printing systems for manufacturing OLED displays. In addition, the company offers delivery, facility management, and non-life insurance services; sells semiconductor products, board computer products, software, and other electronic components; sells and supports network/storage/middleware related solutions; and develops, manufactures, and sells magnetic annealing systems. Tokyo Electron Limited was incorporated in 1951 and is headquartered in Tokyo, Japan.

About Sigma Lithium

Sigma Lithium Corporation engages in the exploration and development of lithium deposits in Brazil. It holds a 100% interest in the Grota do Cirilo, Genipapo, Santa Clara, and São José properties comprising 29 mineral rights covering an area of approximately 185 square kilometers located in the Araçuaí and Itinga regions of the state of Minas Gerais, Brazil. It serves electric vehicle industries worldwide. The company was formerly known as Sigma Lithium Resources Corporation and changed its name to Sigma Lithium Corporation in July 2021. The company is headquartered in São Paulo, Brazil.