Financial Contrast: Penguin Solutions (NASDAQ:PENG) and PDF Solutions (NASDAQ:PDFS)

PDF Solutions (NASDAQ:PDFS) and Penguin Solutions (NASDAQ:PENG) are both technology companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.

Profitability

This table compares PDF Solutions and Penguin Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PDF Solutions	6.28%	8.12%	5.56%
Penguin Solutions	10.43%	36.71%	7.95%

Insider and Institutional Ownership

79.5% of PDF Solutions shares are held by institutional investors. 11.1% of PDF Solutions shares are held by company insiders. Comparatively, 2.9% of Penguin Solutions shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares PDF Solutions and Penguin Solutions”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PDF Solutions	$219.02 million	7.84	-$640,000.00	$0.38	106.95
Penguin Solutions	$1.73 billion	1.74	$180.62 million	$2.59	19.34

Penguin Solutions has higher revenue and earnings than PDF Solutions. Penguin Solutions is trading at a lower price-to-earnings ratio than PDF Solutions, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

PDF Solutions has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500. Comparatively, Penguin Solutions has a beta of 2.87, indicating that its stock price is 187% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for PDF Solutions and Penguin Solutions, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PDF Solutions	0	3	6	0	2.67
Penguin Solutions	1	1	7	1	2.80

PDF Solutions currently has a consensus price target of $58.17, suggesting a potential upside of 43.13%. Penguin Solutions has a consensus price target of $87.50, suggesting a potential upside of 74.65%. Given Penguin Solutions’ stronger consensus rating and higher possible upside, analysts clearly believe Penguin Solutions is more favorable than PDF Solutions.

Summary

Penguin Solutions beats PDF Solutions on 11 of the 15 factors compared between the two stocks.

About PDF Solutions

PDF Solutions provides software, connectivity products and services for the semiconductor and electronics industries. Its offerings help manufacturers collect and analyze production data, monitor processes and identify opportunities to improve yield, quality and operational efficiency. The company’s Exensio platform supports analytics across semiconductor design and manufacturing, while its Cimetrix products provide software for connecting and controlling manufacturing equipment. PDF Solutions also offers engineering and consulting services to help customers implement its technologies and address manufacturing challenges.

About Penguin Solutions

Penguin Solutions, formerly known as SMART Global Holdings, provides computing and memory technologies for businesses and public-sector organizations. Its offerings include systems for artificial intelligence, high-performance computing and edge computing, as well as memory modules and storage products. The company’s portfolio includes Penguin Computing solutions for advanced computing and AI workloads, Stratus platforms designed for continuous availability, and SMART Modular memory and storage products.