Head-To-Head Analysis: Netlist (OTCMKTS:NLST) and Valens Semiconductor (NYSE:VLN)

Valens Semiconductor (NYSE:VLN) and Netlist (OTCMKTS:NLST) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, institutional ownership, risk and profitability.

Institutional & Insider Ownership

33.9% of Valens Semiconductor shares are held by institutional investors. Comparatively, 0.0% of Netlist shares are held by institutional investors. 58.9% of Valens Semiconductor shares are held by company insiders. Comparatively, 2.7% of Netlist shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for Valens Semiconductor and Netlist, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Valens Semiconductor	0	0	1	0	3.00
Netlist	0	0	0	0	N/A

Valens Semiconductor currently has a consensus price target of $4.00, suggesting a potential upside of 115.05%. Given Valens Semiconductor’s higher possible upside, equities research analysts clearly believe Valens Semiconductor is more favorable than Netlist.

Volatility and Risk

Valens Semiconductor has a beta of 0.4, meaning that its share price is 60% less volatile than the S&P 500. Comparatively, Netlist has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500.

Earnings and Valuation

This table compares Valens Semiconductor and Netlist”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Valens Semiconductor	$84.16 million	2.35	-$19.66 million	($0.27)	-6.89
Netlist	$69.21 million	3.36	-$60.40 million	($0.25)	-3.64

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

Profitability

This table compares Valens Semiconductor and Netlist’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Valens Semiconductor	-46.71%	-17.06%	-15.35%
Netlist	-50.76%	-356.11%	-95.47%

Summary

Valens Semiconductor beats Netlist on 9 of the 13 factors compared between the two stocks.

About Valens Semiconductor

Valens Semiconductor Ltd. engages in the provision of semiconductor products for the audio-video and automotive industries. The company offers HDBaseT technology, which enables the simultaneous delivery of ultra-high-definition digital video and audio, Ethernet, USB, control signals, and power through a single long-reach cable. It also provides audio-video solutions for the enterprise, education, industrial, digital signage, industrial, and medical markets. In addition, it offers automotive chipsets that support advanced driver-assistance systems, automotive data solutions, infotainment, telematics, and backbone connectivity. The company’s product series include VS100, VS2000, VS3000, VS6000, VS7000, Valens USB and power extender, Valens VS6320, USB 3.2 Gen1 extension chipset, VA6000, and VA7000. It has a collaboration with iCatch Technology to develop a 360-degree multi-camera videoconferencing solution. The company operates in Israel, China, Hong Kong, the United States, Japan, Germany, Hungary, and internationally. Valens Semiconductor Ltd. is headquartered in Hod Hasharon, Israel.

About Netlist

Netlist, Inc. designs, manufactures, and markets memory subsystems for the server, high-performance computing, and communications markets in the United States and internationally. The company portfolio of proprietary technologies and design techniques, includes efficient planar design, alternative packaging techniques, and custom semiconductor logic, to deliver memory subsystems; and sells specialty memory modules and flash-based products for use in data center and industrial applications. It resells component products, including solid state drive (SSD), NAND flash, and dual inline memory module (DIMM) to storage customers, appliance customers, system builders, and cloud and datacenter customers; and sells component inventory to distributors and other users of memory integrated circuits. The company markets and sells its products through a direct sales force and a network of independent sales representatives. Netlist, Inc. was incorporated in 2000 and is headquartered in Irvine, California.