Himax Technologies (NASDAQ:HIMX) and SMART Global (NASDAQ:SGH) Critical Survey

SMART Global (NASDAQ:SGH) and Himax Technologies (NASDAQ:HIMX) are both small-cap computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Institutional & Insider Ownership

69.8% of Himax Technologies shares are held by institutional investors. 2.3% of SMART Global shares are held by company insiders. Comparatively, 31.5% of Himax Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares SMART Global and Himax Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SMART Global	-14.35%	8.86%	2.01%
Himax Technologies	8.42%	8.94%	4.68%

Valuation and Earnings

This table compares SMART Global and Himax Technologies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SMART Global	$1.44 billion	0.78	-$187.53 million	($3.08)	-6.92
Himax Technologies	$913.37 million	1.07	$50.62 million	$0.27	20.67

Himax Technologies has lower revenue, but higher earnings than SMART Global. SMART Global is trading at a lower price-to-earnings ratio than Himax Technologies, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and target prices for SMART Global and Himax Technologies, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SMART Global	0	0	4	0	3.00
Himax Technologies	0	0	0	0	N/A

SMART Global presently has a consensus target price of $32.25, suggesting a potential upside of 51.41%. Given SMART Global’s higher probable upside, analysts plainly believe SMART Global is more favorable than Himax Technologies.

Volatility & Risk

SMART Global has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500. Comparatively, Himax Technologies has a beta of 2.12, meaning that its share price is 112% more volatile than the S&P 500.

Summary

Himax Technologies beats SMART Global on 10 of the 13 factors compared between the two stocks.

About SMART Global

SMART Global Holdings, Inc., a memory-focused company, engages in the designing and development of enterprise solutions in the United States, China, Europe, and internationally. It operates through Memory Solutions, Intelligent Platform Solutions, and LED Solutions segments. The company offers dynamic random access memory modules, solid-state and flash storage, and other advanced memory solutions for networking and telecom, data analytics, artificial intelligence and machine learning applications; and supply chain services including procurement, logistics, inventory management, temporary warehousing, programming, kitting, and packaging services. It also provides Penguin Computing that focus on technical computing for core and cloud environments through HPC and AI solutions; and Penguin Edge, an edge computing solution for embedded and wireless applications including high-performance products for government, health care, industrial, and telecommunications applications. In addition, the company offers Stratus, which provides simplified, protected, and autonomous fault tolerant computing solutions in the data center and at the Edge through hardware and software services; and leading-edge solutions to education, energy, financial services, government, hyperscale, and manufacturing markets. Further, it provides LED-based products comprising blue and green LED chips based on gallium nitride, and related materials under Cree LED brand; and surface mount devices under the Cree LED XLamp and J Series brand. The company sells its products directly to original equipment manufacturers, enterprise, government and other end customers through direct sales force, e-commerce, customer service representatives, on-site field application engineers, independent sales representatives, distributors, integrators, and resellers. SMART Global Holdings, Inc. was founded in 1988 and is headquartered in Milpitas, California.

About Himax Technologies

Himax Technologies, Inc., a fabless semiconductor company, provides display imaging processing technologies in China, Taiwan, the Philippines, Korea, Japan, Europe, and the United States. The company operates in two segments, Driver IC and Non-Driver Products. It offers display driver integrated circuits (ICs) and timing controllers that are used in televisions, PC monitors, laptops, mobile phones, tablets, automotive, ePaper devices, industrial displays, and other products. The company also provides automotive IC solutions, including traditional driver ICs; advanced in-cell touch and display driver integration; large touch and display driver integration; and local dimming timing controllers, as well as active matrix organic light-emitting diode (AMOLED) solutions, including AMOLED drivers, timing controllers, and touch controller ICs. In addition, it offers application specific IC services; liquid crystal on silicon and micro-electro mechanical system products; Power ICs; complementary metal oxide semiconductor image sensor products; wafer level optics products; 3D sensing products; and ultralow power WiseEye smart image sensing products. The company markets its display drivers to panel manufacturers, mobile device module manufacturers, and manufacturers of end-use products. Himax Technologies, Inc. was incorporated in 2001 and is headquartered in Tainan City, Taiwan.