Financial Survey: Qorvo (NASDAQ:QRVO) vs. Lam Research Corporation (LRCX)

Qorvo (NASDAQ: QRVO) and Lam Research Corporation (NASDAQ:LRCX) are both mid-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Dividends

Lam Research Corporation pays an annual dividend of $1.80 per share and has a dividend yield of 1.1%. Qorvo does not pay a dividend. Lam Research Corporation pays out 19.6% of its earnings in the form of a dividend.

Profitability

This table compares Qorvo and Lam Research Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Qorvo -1.40% 10.10% 7.54%
Lam Research Corporation 21.19% 26.78% 14.96%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Qorvo and Lam Research Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Qorvo 1 9 12 0 2.50
Lam Research Corporation 0 3 16 0 2.84

Qorvo currently has a consensus price target of $73.82, suggesting a potential upside of 5.96%. Lam Research Corporation has a consensus price target of $176.33, suggesting a potential upside of 9.87%. Given Lam Research Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Lam Research Corporation is more favorable than Qorvo.

Institutional & Insider Ownership

97.1% of Qorvo shares are held by institutional investors. Comparatively, 99.0% of Lam Research Corporation shares are held by institutional investors. 0.9% of Qorvo shares are held by company insiders. Comparatively, 0.5% of Lam Research Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Qorvo has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500. Comparatively, Lam Research Corporation has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500.

Valuation and Earnings

This table compares Qorvo and Lam Research Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Qorvo $2.97 billion 2.99 $789.88 million ($0.34) -204.91
Lam Research Corporation $8.01 billion 3.24 $2.22 billion $9.20 17.44

Lam Research Corporation has higher revenue and earnings than Qorvo. Qorvo is trading at a lower price-to-earnings ratio than Lam Research Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Lam Research Corporation beats Qorvo on 13 of the 15 factors compared between the two stocks.

Qorvo Company Profile

Qorvo, Inc. is a provider of technologies and radio frequency (RF) solutions for mobile, infrastructure and defense and aerospace applications. The Company designs, develops, manufactures and markets its products to the United States and international original equipment manufacturers (OEMs) and original design manufacturers (ODMs). Its segments include Mobile Products (MP) and Infrastructure and Defense Products (IDP). The MP segment is a supplier of radio frequency (RF) solutions that perform various functions in the cellular radio front end section of smartphones and other cellular devices. The IDP segment is a supplier of RF solutions that support various global applications, including ubiquitous high-speed network connectivity to the cloud, data center communications, Internet connectivity throughout the home and workplace, and upgraded military capabilities across the globe. It operates design, sales and manufacturing facilities located throughout Asia, Europe and North America.

Lam Research Corporation Company Profile

Lam Research Corporation is a supplier of wafer fabrication equipment and services to the semiconductor industry. The Company designs, manufactures, markets, refurbishes and services semiconductor processing systems that are used in the fabrication of integrated circuits (ICs). It operates through manufacturing and servicing of wafer processing semiconductor manufacturing equipment segment. Its products are designed to enable its customers build a range of devices that are used in a range of electronic products, including cell phones, tablets, computers, storage devices, and networking equipment. Its customer base includes semiconductor memory, foundry, and integrated device manufacturers (IDMs) that make products, such as dynamic random-access memory (DRAM), negative-AND (NAND) memory and logic devices. It offers a portfolio of products that are used in several areas of the semiconductor manufacturing process flow, including thin film deposition, plasma etch and single-wafer clean.

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