IPG Photonics (NASDAQ:IPGP) and Cree (NASDAQ:CREE) 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 valuation, profitability, earnings, dividends, institutional ownership, analyst recommendations and risk.
Institutional & Insider Ownership
58.2% of IPG Photonics shares are held by institutional investors. 33.8% of IPG Photonics shares are held by insiders. Comparatively, 0.6% of Cree shares are held by 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 table compares IPG Photonics and Cree’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares IPG Photonics and Cree’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|IPG Photonics||$1.41 billion||5.56||$347.61 million||$7.26||20.09|
|Cree||$1.49 billion||2.76||-$279.96 million||($0.15)||-268.07|
IPG Photonics has higher earnings, but lower revenue than Cree. Cree is trading at a lower price-to-earnings ratio than IPG Photonics, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and target prices for IPG Photonics and Cree, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
IPG Photonics currently has a consensus target price of $212.00, indicating a potential upside of 45.37%. Cree has a consensus target price of $44.44, indicating a potential upside of 10.53%. Given IPG Photonics’ stronger consensus rating and higher probable upside, equities research analysts clearly believe IPG Photonics is more favorable than Cree.
Volatility & Risk
IPG Photonics has a beta of 1.77, meaning that its stock price is 77% more volatile than the S&P 500. Comparatively, Cree has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500.
IPG Photonics beats Cree on 13 of the 14 factors compared between the two stocks.
About IPG Photonics
IPG Photonics Corporation develops and manufactures a range of high-performance fiber lasers, fiber amplifiers, and diode lasers used in various applications primarily in materials processing worldwide. The company's laser products include low, medium, and high power lasers; fiber pigtailed packaged diodes and fiber coupled direct diode laser systems; high-energy pulsed lasers, multi-wavelength and tunable lasers, and single-polarization and single-frequency lasers; laser diode chips and packaged laser diodes; and high power optical fiber delivery cables, fiber couplers, beam switches, chillers, scanners, and other accessories. It also provides erbium-doped fiber and Raman amplifiers, and integrated communications systems, which are deployed in broadband networks, such as fiber to the home, fiber to the curb, passive optical networks, and dense wavelength division multiplexing (DWDM) networks; ytterbium and thulium specialty fiber amplifiers and broadband light sources; and single-frequency, linearly polarized, and polarization-maintaining versions of its amplifier products. In addition, the company offers interconnect, coarse wavelength division multiplexing, DWDM, and tunable-based pluggable interfaces to serve optical transmission needs; integrated laser systems; 2D flat sheet cutter systems and multi-axis systems; welding seam stepper and picker, a fiber laser welding tool; and specialized fiber laser systems for material processing applications. Its lasers and amplifiers are also used in materials processing, advanced communications, and medical applications. The company markets its products to original equipment manufacturers, system integrators, and end users through direct sales force, as well as through agreements with independent sales representatives and distributors. IPG Photonics Corporation was founded in 1990 and is headquartered in Oxford, Massachusetts.
Cree, Inc. provides lighting-class light emitting diode (LED), lighting, and semiconductor products for power and radio-frequency (RF) applications in the United States, China, Europe, South Korea, Japan, Malaysia, Taiwan, and internationally. It operates in three segments: Wolfspeed, LED Products, and Lighting Products. The Wolfspeed segment offers silicon carbide (SiC) materials for RF, power switching, gemstones, and other applications. It also provides SiC power device products, including SiC Schottky diodes, metal oxide semiconductor field effect transistors (MOSFETs), power modules, and gate driver boards for electric vehicles, including charging infrastructure, server power supplies, solar inverters, uninterruptible power supplies, industrial power supplies, and other applications. In addition, this segment offers gallium nitride (GaN) die, high-electron mobility transistors (HEMTs), monolithic microwave integrated circuits (MMICs), and laterally diffused MOSFET (LDMOS) power transistors for telecommunications infrastructure, military, and other commercial applications; and custom die manufacturing services for GaN HEMTs and MMICs. The LED Products segment provides blue and green LED chip products for video screens, gaming displays, function indicator lights and automotive backlights, headlamps, and directional indicators. It also offers XLamp LED components and LED modules for lighting applications; and surface mount and through-hole packaged LED products for video, signage, general illumination, transportation, gaming, and specialty lighting applications. The Lighting Products segment offers LED lighting systems and lamps for to distributors, retailers, and customers for offices, retail spaces, restaurants, hospitality, schools, universities, manufacturing, healthcare, airports, municipal, residential, street lighting, parking structures, and other applications. The company was founded in 1987 and is headquartered in Durham, North Carolina.
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