Head-To-Head Contrast: Arteris (NASDAQ:AIP) and SemiLEDs (NASDAQ:LEDS)

Arteris (NASDAQ:AIP) and SemiLEDs (NASDAQ:LEDS) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, profitability, institutional ownership and valuation.

Profitability

This table compares Arteris and SemiLEDs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arteris	-68.37%	-274.66%	-35.43%
SemiLEDs	-44.37%	-120.86%	-18.80%

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arteris	$53.30 million	5.53	-$36.87 million	($1.03)	-7.44
SemiLEDs	$5.31 million	1.64	-$2.69 million	($0.47)	-2.57

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Arteris and SemiLEDs, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arteris	0	1	3	0	2.75
SemiLEDs	0	0	0	0	N/A

Arteris currently has a consensus price target of $13.00, indicating a potential upside of 69.71%. Given Arteris’ higher possible upside, analysts plainly believe Arteris is more favorable than SemiLEDs.

Risk & Volatility

Arteris has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500. Comparatively, SemiLEDs has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500.

Insider and Institutional Ownership

64.4% of Arteris shares are owned by institutional investors. Comparatively, 76.3% of SemiLEDs shares are owned by institutional investors. 33.7% of Arteris shares are owned by company insiders. Comparatively, 40.0% of SemiLEDs shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

SemiLEDs beats Arteris on 8 of the 13 factors compared between the two stocks.

About Arteris

Arteris, Inc. provides semiconductor interconnect intellectual property (IP) and System-on-Chip (Soc) Integration Automation software solutions (SIA) in the Americas, the Asia Pacific, Europe, and the Middle East. The company develops, licenses, and supports the on-chip interconnect fabric technology used in Soc designs and Network-on-Chip (NoC) interconnect IP. Its products include FlexNoC and FlexWay silicon-proven interconnect IP products; Ncore, a silicon-proven and cache coherent interconnect IP product that provides scalable, configurable, and area efficient characteristics; and CodaCache, a last-level cache semiconductor IP product. The company also offers SIA products comprising Magillem Connectivity that shortens and streamlines the SoC integration process; and Magillem Registers and CSRCompiler that addresses hardware-software integration challenges for SoCs. The company serves semiconductor manufacturers, original equipment manufacturers, hyperscale system houses, semiconductor design houses, and other producers of electronic systems. Arteris, Inc. was founded in 2003 and is headquartered in Campbell, California.

About SemiLEDs

SemiLEDs Corporation develops, manufactures, and sells light emitting diode (LED) chips, LED components, and LED modules and systems in the United States, Taiwan, the Netherlands, Germany, Japan, and internationally. The company also sells enhanced vertical, LED product series in blue, white, green, and UV; LED chips to packagers or distributors; and lighting products primarily to original design manufacturers of lighting products and the end-users of lighting devices, as well as packs and sells its LED chips. Its products are used for general lighting applications, including commercial, industrial, and residential lighting; and specialty industrial applications, such as ultraviolet or UV, curing of polymers, LED light therapy in medical/cosmetic applications, counterfeit detection, germicidal and viricidal devices LED lighting for horticulture applications, architectural lighting, and entertainment lighting. The company was incorporated in 2005 and is based in Chu-Nan, Taiwan.