Financial Analysis: Texas Instruments (NASDAQ:TXN) vs. POET Technologies (NASDAQ:POET)

POET Technologies (NASDAQ:POET) and Texas Instruments (NASDAQ:TXN) are both computer and technology companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, institutional ownership, earnings and risk.

Analyst Ratings

This is a summary of current recommendations for POET Technologies and Texas Instruments, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
POET Technologies	0	0	2	1	3.33
Texas Instruments	2	12	8	0	2.27

POET Technologies presently has a consensus target price of $6.25, suggesting a potential upside of 59.85%. Texas Instruments has a consensus target price of $209.20, suggesting a potential upside of 18.64%. Given POET Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe POET Technologies is more favorable than Texas Instruments.

Volatility & Risk

POET Technologies has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Texas Instruments has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.

Earnings & Valuation

This table compares POET Technologies and Texas Instruments”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
POET Technologies	$119,946.00	2,544.93	-$20.27 million	($0.59)	-6.63
Texas Instruments	$15.64 billion	10.26	$4.80 billion	$5.19	33.97

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

Profitability

This table compares POET Technologies and Texas Instruments’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
POET Technologies	N/A	-194.16%	-132.32%
Texas Instruments	30.68%	28.08%	13.64%

Insider & Institutional Ownership

2.0% of POET Technologies shares are owned by institutional investors. Comparatively, 85.0% of Texas Instruments shares are owned by institutional investors. 0.5% of POET Technologies shares are owned by company insiders. Comparatively, 0.6% of Texas Instruments shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Texas Instruments beats POET Technologies on 11 of the 15 factors compared between the two stocks.

About POET Technologies

POET Technologies Inc. designs, develops, manufactures, and sells discrete and integrated opto-electronic solutions in Canada, the United States, Singapore, and China. It offers integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques. It also develops photonic integrated components. The company serves the data center, telecommunications, Internet of things and industrial sensing, automotive LIDAR, optical coherence tomography for medical devices, and virtual reality systems markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. was incorporated in 1972 and is headquartered in Toronto, Canada.

About Texas Instruments

Texas Instruments Incorporated designs, manufactures, and sells semiconductors to electronics designers and manufacturers in the United States and internationally. The company operates through Analog and Embedded Processing segments. The Analog segment offers power products to manage power requirements across various voltage levels, including battery-management solutions, DC/DC switching regulators, AC/DC and isolated controllers and converters, power switches, linear regulators, voltage references, and lighting products. This segment provides signal chain products that sense, condition, and measure signals to allow information to be transferred or converted for further processing and control, including amplifiers, data converters, interface products, motor drives, clocks, and logic and sensing products. The Embedded Processing segment offers microcontrollers that are used in electronic equipment; digital signal processors for mathematical computations; and applications processors for specific computing activity. This segment offers products for use in various markets, such as industrial, automotive, personal electronics, communications equipment, enterprise systems, and calculators and other. It provides DLP products primarily for use in project high-definition images; calculators; and application-specific integrated circuits. The company markets and sells its semiconductor products through direct sales and distributors, as well as through its website. Texas Instruments Incorporated was founded in 1930 and is headquartered in Dallas, Texas.