Tessera Holding Corporation (NASDAQ: XPER) and STR Holdings (OTCMKTS:STRI) are both small-cap business services companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.
Risk & Volatility
Tessera Holding Corporation has a beta of 0.79, indicating that its stock price is 21% less volatile than the S&P 500. Comparatively, STR Holdings has a beta of 1.48, indicating that its stock price is 48% more volatile than the S&P 500.
This table compares Tessera Holding Corporation and STR Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Tessera Holding Corporation||-22.54%||8.10%||3.38%|
Tessera Holding Corporation pays an annual dividend of $0.80 per share and has a dividend yield of 4.2%. STR Holdings does not pay a dividend. Tessera Holding Corporation pays out -55.2% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares Tessera Holding Corporation and STR Holdings’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Tessera Holding Corporation||$259.57 million||3.64||$56.08 million||($1.45)||-13.21|
|STR Holdings||$20.11 million||0.26||-$15.87 million||($0.45)||-0.60|
Tessera Holding Corporation has higher revenue and earnings than STR Holdings. Tessera Holding Corporation is trading at a lower price-to-earnings ratio than STR Holdings, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
99.6% of Tessera Holding Corporation shares are held by institutional investors. Comparatively, 0.0% of STR Holdings shares are held by institutional investors. 2.4% of Tessera Holding Corporation shares are held by company insiders. Comparatively, 10.3% of STR Holdings shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This is a summary of current ratings and target prices for Tessera Holding Corporation and STR Holdings, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Tessera Holding Corporation||0||1||1||0||2.50|
Tessera Holding Corporation currently has a consensus target price of $53.00, suggesting a potential upside of 176.76%. Given Tessera Holding Corporation’s higher possible upside, equities analysts plainly believe Tessera Holding Corporation is more favorable than STR Holdings.
Tessera Holding Corporation beats STR Holdings on 11 of the 14 factors compared between the two stocks.
About Tessera Holding Corporation
Tessera Holding Corporation is a product and technology licensing company. The Company’s technologies and intellectual property are deployed, in areas, such as audio, computational imaging, computer vision, mobile computing and communications, memory, data storage, three dimensional (3D) semiconductor interconnect and packaging. The Company delivers smart sight and sound solutions, and 3D semiconductor interconnect solutions for mobile devices, consumer electronics, and automotive markets. The Company also addresses technologies, such as Internet of Things (IoT) and augmented reality/virtual reality (AR/VR). It offers audio solutions for mobile devices, home theater systems and cinema. The Company’s subsidiaries include Tessera Technologies, Inc., DTS, Inc., Invensas Corporation and FotoNation.
About STR Holdings
STR Holdings, Inc. is a holding company. The Company is a provider of encapsulants to the solar industry. Encapsulant is a component used to protect solar cells and hold solar modules together. The Company has developed ethylene-vinyl acetate (EVA)-based encapsulants for use in commercial solar module manufacturing. The Company’s encapsulant formulations offer a range of properties and processing attributes, including various curing times and temperatures that align with the requirements of its customers’ individual lamination processes and module constructions. The Company’s formulations can be used in both crystalline silicon and thin-film modules. The Company operates production facilities in Llanera, Asturias, Spain and Shajiabang, Changshu, Jiangsu Province, China. It has a total annual production capacity of approximately 5.1 gigawatts. Its customers are solar module manufacturers located mainly in North America, Europe and Asia.
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