Head-To-Head Analysis: MKS (NASDAQ:MKSI) & Diodes (NASDAQ:DIOD)

Diodes (NASDAQ:DIOD) and MKS (NASDAQ:MKSI) are both technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, valuation, dividends, institutional ownership, profitability and risk.

Profitability

This table compares Diodes and MKS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diodes	5.27%	4.33%	3.41%
MKS	10.15%	24.72%	7.80%

Analyst Recommendations

This is a summary of recent ratings and price targets for Diodes and MKS, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diodes	0	1	3	1	3.00
MKS	1	2	12	1	2.81

Diodes presently has a consensus price target of $135.00, suggesting a potential upside of 49.95%. MKS has a consensus price target of $382.86, suggesting a potential upside of 52.30%. Given MKS’s higher possible upside, analysts clearly believe MKS is more favorable than Diodes.

Earnings and Valuation

This table compares Diodes and MKS”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diodes	$1.48 billion	2.80	$66.14 million	$1.85	48.66
MKS	$4.35 billion	3.91	$295.00 million	$6.27	40.09

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

Volatility and Risk

Diodes has a beta of 1.89, indicating that its share price is 89% more volatile than the S&P 500. Comparatively, MKS has a beta of 1.98, indicating that its share price is 98% more volatile than the S&P 500.

Institutional and Insider Ownership

99.2% of Diodes shares are held by institutional investors. Comparatively, 99.8% of MKS shares are held by institutional investors. 1.7% of Diodes shares are held by insiders. Comparatively, 0.6% of MKS shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

MKS beats Diodes on 11 of the 14 factors compared between the two stocks.

About Diodes

Diodes Incorporated, together with its subsidiaries, manufactures and supplies application-specific standard products in the broad discrete, logic, analog, and mixed-signal semiconductor markets worldwide. The company offers discrete semiconductor products, such as MOSFETs, SiC MOSFETs; data line protection, power line protection, thyristers, USB Type-C protection, and transient voltage suppressors; Schottky, small signal switching, Zener, and SiC diodes; bridges, super barrier, Schottky, Schottky bridge, and fast/ultra-fast rectifiers; and bipolar, avalanche, gate driver, and pre-bias transistors. It also provides analog products, including power management devices comprising AC-DC and DC-DC converters, USB power switches, low dropout, photocoupler and linear voltage regulators; standard linear devices consisting of operational amplifiers and comparators, current monitors, voltage references, and reset generators; LED lighting drivers; audio amplifiers; and sensor products, such as hall-effect sensors and motor drivers. In addition, the company offers mixed-signal products, such as high speed mux/demux, digital switches, interface, redrivers, universal level shifters/voltage translators, clock ICs and packet switches; standard logic products comprising low-voltage complementary metal-oxide-semiconductor (CMOS) and advanced high-speed CMOS devices; ultra-low power CMOS logic; and analog switches; multichip products and co-packaged discrete, analog and mixed-signal silicon in miniature packages; and silicon and silicon epitaxial wafers used in manufacturing frequency control products and contact images sensors. It serves the industrial, automotive, computing, communications, and consumer markets through direct sales, marketing personnel, independent sales representatives, and distributors. The company was incorporated in 1959 and is headquartered in Plano, Texas.

About MKS

MKS Instruments, Inc. provides foundational technology solutions to semiconductor manufacturing, electronics and packaging, and specialty industrial applications in the United States, Germany, China, South Korea, and internationally. It operates through Vacuum Solutions Division (VSD), Photonics Solutions Division (PSD), and Material Solutions Division (MSD) segments. The VSD segment provides foundational technology solutions, including pressure measurement and control, flow measurement and control, gas and vapor delivery, gas composition analysis, electronic control technology, reactive gas generation and delivery, power generation and delivery, and vacuum technology. The PSD segment offers range of solutions, which include lasers, beam measurement and profiling, precision motion control, vibration isolation systems, photonics instruments, temperature sensing, opto-mechanical components, optical elements, systems for flexible PCB laser processing, and laser-based systems, as well as high density interconnect PCB and package manufacturing. The MSD segment develops, process, and manufactures technologies comprising advanced surface modification, electroless and electrolytic plating, and surface finishing for chemistry, equipment, software, and services markets, as well as high-technology applications. In addition, the company sells its products and services through direct sales, network of independent distributors, and sales representatives, as well as websites, including product catalogs. The company was incorporated in 1961 and is headquartered in Andover, Massachusetts.