Financial Review: ARM (ARMH) versus Mindspeed Technologies (MSPD)

Mindspeed Technologies (NASDAQ: MSPD) and ARM (NASDAQ:ARMH) are both companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Earnings and Valuation

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This table compares Mindspeed Technologies and ARM’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mindspeed Technologies N/A N/A N/A N/A N/A
ARM N/A N/A N/A N/A N/A

Profitability

This table compares Mindspeed Technologies and ARM’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mindspeed Technologies N/A N/A N/A
ARM 33.10% 19.72% 16.87%

Dividends

ARM pays an annual dividend of $0.34 per share and has a dividend yield of 0.5%. Mindspeed Technologies does not pay a dividend.

Analyst Recommendations

This is a summary of current ratings and price targets for Mindspeed Technologies and ARM, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mindspeed Technologies 0 0 0 0 N/A
ARM 0 0 1 0 3.00

Institutional & Insider Ownership

19.7% of ARM shares are held by institutional investors. 3.0% of ARM shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

ARM beats Mindspeed Technologies on 7 of the 7 factors compared between the two stocks.

About Mindspeed Technologies

Mindspeed Technologies, Inc. (Mindspeed) designs, develops and sells semiconductor solutions for communications applications in the wireline and wireless network infrastructure, which includes enterprise networks, broadband access networks (fixed and mobile), and metropolitan and wide area networks (WAN). Mindspeed has organized its solutions for these networks into three product families: communications convergence processing (formerly known as multiservice access), high-performance analog and WAN communications. Its products are sold to original equipment manufacturers (OEMs) for use in a variety of network infrastructure equipment. The Company’s customers include Alcatel-Lucent, Cisco Systems, Inc., Huawei Technologies Co. Ltd. and Zhongxing Telecom Equipment Corp. Effective December 18, 2013, M/A-Com Technology Solutions Holdings Inc acquired the entire interest of Mindspeed Technologies Inc.

About ARM

ARM Holdings plc (ARM) is a company engaged in designing a range of inter-related intellectual property (IP), including microprocessors, Physical IP, and supporting software and tools. Its product offering includes 16/32/64-bit reduced instruction set computing (RISC) microprocessors, data engines, graphics processors, digital libraries, embedded memories, peripherals, software and development tools, as well as analog functions and high-speed connectivity products. The Company licenses and sells its technology and products to international electronics companies, which in turn manufacture, market and sell microprocessors, application-specific integrated circuits (ASICs), application-specific standard processors (ASSPs) and microcontrollers (MCUs) based on ARM’s technology to systems companies for incorporation into a range of end products. Its principal geographic markets are Europe, the United States and Asia Pacific.

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