Aehr Test Systems (NASDAQ:AEHR) & Rambus (NASDAQ:RMBS) Head to Head Analysis

Rambus (NASDAQ:RMBS) and Aehr Test Systems (NASDAQ:AEHR) are both technology companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, risk, dividends and institutional ownership.

Institutional & Insider Ownership

88.5% of Rambus shares are owned by institutional investors. Comparatively, 69.7% of Aehr Test Systems shares are owned by institutional investors. 0.7% of Rambus shares are owned by company insiders. Comparatively, 4.6% of Aehr Test Systems shares are owned 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.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Rambus and Aehr Test Systems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rambus	0	3	6	1	2.80
Aehr Test Systems	1	1	5	1	2.75

Rambus currently has a consensus target price of $147.00, indicating a potential upside of 97.24%. Aehr Test Systems has a consensus target price of $118.75, indicating a potential upside of 121.67%. Given Aehr Test Systems’ higher probable upside, analysts clearly believe Aehr Test Systems is more favorable than Rambus.

Valuation and Earnings

This table compares Rambus and Aehr Test Systems”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rambus	$796.11 million	10.03	$230.46 million	$2.43	30.67
Aehr Test Systems	$50.00 million	34.99	-$7.13 million	($0.24)	-223.21

Rambus has higher revenue and earnings than Aehr Test Systems. Aehr Test Systems is trading at a lower price-to-earnings ratio than Rambus, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Rambus and Aehr Test Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rambus	33.40%	19.43%	17.59%
Aehr Test Systems	-14.25%	-3.83%	-3.36%

Risk & Volatility

Rambus has a beta of 1.93, meaning that its share price is 93% more volatile than the S&P 500. Comparatively, Aehr Test Systems has a beta of 3.36, meaning that its share price is 236% more volatile than the S&P 500.

Summary

Rambus beats Aehr Test Systems on 10 of the 14 factors compared between the two stocks.

About Rambus

Rambus Inc. provides semiconductor products in the United States, South Korea, Singapore, and internationally. The company offers DDR memory interface chips, including DDR5 and DDR4 memory interface chips to module manufacturers, OEMs, and hyperscalers; silicon IP, such as interface and security IP solutions that move and protect data in advanced data center, government, and automotive applications; and interface IP solutions for high-speed memory and chip-to-chip digital controller IP. It also provides a portfolios of security IP solutions, including crypto cores, hardware roots of trust, high-speed protocol engines, and chip provisioning technologies; and portfolio of patents that covers memory architecture, high-speed serial links, and security products. It markets its products and services through its direct sales force and distributors. Rambus Inc. was incorporated in 1990 and is headquartered in San Jose, California.

About Aehr Test Systems

Aehr Test Systems provides test solutions for testing, burning-in, and semiconductor devices in wafer level, singulated die, and package part form, and installed systems worldwide. Its product portfolio includes FOX-XP and FOX-NP systems that are full wafer contact and singulated die/module test and burn-in systems that can test, burn-in, and stabilize range of devices, including silicon carbide-based and other power semiconductors, 2D and 3D sensors used in mobile phones, tablets and other computing devices, memory semiconductors, processors, microcontrollers, systems-on-a-chip, and photonics and integrated optical devices. The company also offers FOX-CP system, a low-cost single-wafer compact test solution for logic, memory, and photonic devices; FOX WaferPak Contactor, a full wafer contactor capable of testing wafers up to 300mm that enables integrated circuit manufacturers to perform test, burn-in, and stabilization of full wafers on the FOX-P systems. In addition, it provides FOX DiePak Carrier, a reusable temporary package that enables IC manufacturers to perform final test and burn-in of bare die and modules; and FOX DiePak Loader. The company was incorporated in 1977 and is headquartered in Fremont, California.