Valens Semiconductor (NYSE:VLN) and Universal Display (NASDAQ:OLED) Critical Contrast

Valens Semiconductor (NYSE:VLN) and Universal Display (NASDAQ:OLED) are both technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, dividends, risk, institutional ownership, analyst recommendations, earnings and profitability.

Insider and Institutional Ownership

33.9% of Valens Semiconductor shares are owned by institutional investors. Comparatively, 78.2% of Universal Display shares are owned by institutional investors. 58.9% of Valens Semiconductor shares are owned by company insiders. Comparatively, 2.2% of Universal Display shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Valens Semiconductor	-45.23%	-30.58%	-23.97%
Universal Display	32.24%	11.35%	10.17%

Volatility & Risk

Valens Semiconductor has a beta of 1.3, indicating that its share price is 30% more volatile than the S&P 500. Comparatively, Universal Display has a beta of 1.53, indicating that its share price is 53% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Valens Semiconductor and Universal Display, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Valens Semiconductor	1	0	1	0	2.00
Universal Display	2	3	3	0	2.12

Valens Semiconductor presently has a consensus price target of $4.00, indicating a potential upside of 140.24%. Universal Display has a consensus price target of $114.00, indicating a potential upside of 51.80%. Given Valens Semiconductor’s higher probable upside, equities research analysts clearly believe Valens Semiconductor is more favorable than Universal Display.

Earnings & Valuation

This table compares Valens Semiconductor and Universal Display”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Valens Semiconductor	$70.62 million	2.55	-$31.58 million	($0.32)	-5.20
Universal Display	$650.61 million	5.31	$242.07 million	$4.13	18.18

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

Summary

Universal Display beats Valens Semiconductor on 12 of the 14 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 Universal Display

Universal Display Corporation engages in the research, development, and commercialization of organic light emitting diode (OLED) technologies and materials for use in display and solid-state lighting applications in the United States and internationally. The company offers PHOLED technologies and materials for displays and lighting products under the UniversalPHOLED brand. It is also involved in the research, development, and commercialization of other OLED device and manufacturing technologies, including FOLED that are flexible OLEDs for the fabrication of OLEDs on flexible substrates; and OVJP, an organic vapor jet printing technology. In addition, the company provides technology development and support services, including third-party collaboration and support to third parties for the commercialization of their OLED products; and contract research services in the areas of chemical synthesis research, development, and commercialization for non-OLED applications, as well as engages in the intellectual property and technology licensing activities. Universal Display Corporation was founded in 1985 and is headquartered in Ewing, New Jersey.