Brooks Automation (NASDAQ: BRKS) and Cohu (NASDAQ:COHU) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, dividends, institutional ownership, profitability and analyst recommendations.
Earnings and Valuation
This table compares Brooks Automation and Cohu’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Brooks Automation||$668.56 million||2.61||$95.89 million||$0.80||32.43|
|Cohu||$314.92 million||1.63||$37.41 million||$0.69||26.61|
Brooks Automation has higher revenue and earnings than Cohu. Cohu is trading at a lower price-to-earnings ratio than Brooks Automation, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
90.4% of Brooks Automation shares are owned by institutional investors. Comparatively, 83.9% of Cohu shares are owned by institutional investors. 2.2% of Brooks Automation shares are owned by company insiders. Comparatively, 6.0% of Cohu shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This is a breakdown of current recommendations and price targets for Brooks Automation and Cohu, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Brooks Automation currently has a consensus target price of $27.67, suggesting a potential upside of 6.66%. Cohu has a consensus target price of $23.67, suggesting a potential upside of 28.90%. Given Cohu’s higher probable upside, analysts clearly believe Cohu is more favorable than Brooks Automation.
Brooks Automation pays an annual dividend of $0.40 per share and has a dividend yield of 1.5%. Cohu pays an annual dividend of $0.24 per share and has a dividend yield of 1.3%. Brooks Automation pays out 50.0% of its earnings in the form of a dividend. Cohu pays out 34.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
This table compares Brooks Automation and Cohu’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
Brooks Automation has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Cohu has a beta of 0.88, meaning that its stock price is 12% less volatile than the S&P 500.
Brooks Automation beats Cohu on 12 of the 16 factors compared between the two stocks.
About Brooks Automation
Brooks Automation, Inc. is a provider of automation and cryogenic solutions for various applications and markets. The Company operates through two segments: Brooks Semiconductor Solutions Group and Brooks Life Science Systems. The Brooks Semiconductor Solutions Group segment offers critical automated transport, vacuum and contamination controls solutions and services. Its product offerings include robots and integrated automation systems for handling of substrates. It is also a provider of cryogenic components to create vacuum and thermal stability within critical operating environments in the manufacturing process. It also offers equipment for automated contamination control, conditioning and metrology solutions for wafer and reticle carriers. The Brooks Life Science Systems segment offers sample life cycle management solutions that provide life science and bioscience customers with a range of sample management solutions for scientific research and support drug development.
Cohu, Inc. is a supplier of semiconductor test and inspection handlers, micro-electro mechanical system (MEMS) test modules, test contactors and thermal sub-systems used by global semiconductor manufacturers and test subcontractors. It develops, manufactures, sells and services a line of equipment capable of handling a range of integrated circuits and light-emitting diodes. It operates through semiconductor equipment segment. It offers products for the pick-and-place, gravity-feed, test-in-strip and turret handling, MEMS, burn-in and system-level test markets. It sells various products, including Delta MATRiX, Delta Pyramid, Delta Eclipse, Delta LinX, Rasco SO1000, Rasco SO2000, Rasco Saturn and Jupiter, Rasco Jaguar, Ismeca NY32, Ismeca NY20 and Delta Fusion HD. Its manufacturing operations are located in Malacca, Malaysia (handlers); Poway, California (thermal subsystems); Laguna, the Philippines (kits and contactors); Kolbermoor, Germany (handlers), and Osaka, Japan (contactors).
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