Critical Analysis: GlobalFoundries (NASDAQ:GFS) & ams-OSRAM (OTCMKTS:AMSSY)

ams-OSRAM (OTCMKTS:AMSSY) and GlobalFoundries (NASDAQ:GFS) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Earnings & Valuation

This table compares ams-OSRAM and GlobalFoundries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ams-OSRAM	$3.76 billion	0.54	-$147.08 million	($1.19)	-8.61
GlobalFoundries	$6.79 billion	4.32	$885.00 million	$1.39	38.47

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

Profitability

This table compares ams-OSRAM and GlobalFoundries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ams-OSRAM	-6.18%	0.79%	0.11%
GlobalFoundries	11.40%	6.85%	4.76%

Volatility & Risk

ams-OSRAM has a beta of 1.74, indicating that its share price is 74% more volatile than the S&P 500. Comparatively, GlobalFoundries has a beta of 1.76, indicating that its share price is 76% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for ams-OSRAM and GlobalFoundries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ams-OSRAM	1	2	1	0	2.00
GlobalFoundries	1	9	8	1	2.47

GlobalFoundries has a consensus price target of $74.62, indicating a potential upside of 39.55%. Given GlobalFoundries’ stronger consensus rating and higher probable upside, analysts clearly believe GlobalFoundries is more favorable than ams-OSRAM.

Dividends

ams-OSRAM pays an annual dividend of $0.13 per share and has a dividend yield of 1.3%. GlobalFoundries pays an annual dividend of $0.48 per share and has a dividend yield of 0.9%. ams-OSRAM pays out -10.8% of its earnings in the form of a dividend. GlobalFoundries pays out 34.5% 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. ams-OSRAM is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

GlobalFoundries beats ams-OSRAM on 13 of the 15 factors compared between the two stocks.

About ams-OSRAM

ams-OSRAM AG designs, manufactures, and sells LED and optical sensor solutions in Europe, the Middle East, Africa, the Americas, and Asia/Pacific. The company operates in Semiconductors and Lamps & Systems segments. The Semiconductors segment offers semiconductor-based products and solutions, such as high-performance LEDs, lasers, and optical sensors for automotive, consumer, and industrial and medical technology end markets. The Lamps & Systems segment provides lamps and lighting systems for the automotive, industrial, and medical end markets. The company was formerly known as ams AG and changed its name to ams-OSRAM AG in January 2022. ams-OSRAM AG is headquartered in Premstätten, Austria.

About GlobalFoundries

GlobalFoundries Inc., a semiconductor foundry, provides range of mainstream wafer fabrication services and technologies worldwide. It manufactures various semiconductor devices, including microprocessors, mobile application processors, baseband processors, network processors, radio frequency modems, microcontrollers, and power management units. GlobalFoundries Inc. has a strategic partnership with Efficient Computer to develop high-performance computer processors. The company was incorporated in 2008 and is headquartered in Malta, New York.