Microchip Technology Incorporated (MCHP) vs Tower Semiconductor Ltd. (TSEM)

Microchip Technology Incorporated and Tower Semiconductor Ltd. are both Semiconductors companies. Microchip Technology Incorporated is the larger, with a market value of $41.0B against $25.5B — 1.6× the size. Tower Semiconductor Ltd. trades at the lower P/E: 89.7× against 117×. Microchip Technology Incorporated grew revenue faster over the last twelve months: 20.9% against 14.9%. Tower Semiconductor Ltd. has the higher net margin (16.9% vs 7.17%) and the higher return on invested capital (9.97% vs 4.30%). Across the 22 metrics below, Tower Semiconductor Ltd. leads on 12 and Microchip Technology Incorporated on 10.

Valuation

Metric MCHP TSEM Semiconductors median
P/E 117.45 89.68 49.41
P/S 8.33 15.22 8.58
P/B 6.62 8.47 5.49
Price to free cash flow 38.43 81.90 47.02
EV/EBITDA 33.01 41.34 30.78
EV/Sales 9.71 14.44 8.79
Earnings yield 0.85% 1.12% 0.62%
Free cash flow yield 2.60% 1.22% 0.59%

Profitability

Metric MCHP TSEM Semiconductors median
Gross margin 60.19% 26.87% 52.25%
Operating margin 15.52% 16.16% 4.85%
Net margin 7.17% 16.94% 4.77%
Free cash flow margin 21.69% 18.04% 8.65%
Return on equity 5.52% 10.53% 3.11%
Return on assets 2.50% 8.30% 1.91%
Return on invested capital 4.30% 9.97% 2.46%

Growth

Metric MCHP TSEM Semiconductors median
Revenue growth (TTM) 20.93% 14.90% 16.66%
EPS growth (last fiscal year) 2,300.00% 4.86% —
Revenue growth, 5-year CAGR (2.82%) 4.35% 5.60%
Net income growth, 5-year CAGR (19.41%) 21.78% 0.00%

Health

Metric MCHP TSEM Semiconductors median
Debt to equity 0.83 0.05 0.05
Current ratio 1.92 4.91 3.35
Net debt to EBITDA 4.33 (1.99) 0.58

Dividend

Metric MCHP TSEM Semiconductors median
Dividend yield 2.06% — 1.93%
Payout ratio 0.32 0.00 0.00

Size

Metric MCHP TSEM Semiconductors median
Market cap 41.04b 25.45b 5.67b

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