Better Buy: Himax Technologies vs. NVIDIA
It's not a surprise to see bargain hunters circling some of the former high-flying chip stocks. NVIDIA (NASDAQ: NVDA) and Himax Technologies (NASDAQ: HIMX) are trading 22% and 46% off their recent highs, respectively. If you liked them at their February peaks, you may like them even more now, a month later, at dramatic markdowns.
The two companies specialize in display semiconductor solutions, but they are leagues apart in terms of most investor measuring sticks. The differences start at the weigh-in, with NVIDIA and its $150 billion market cap clocking in 300 times larger than Himax at less than $500 million. NVIDIA is profitable; it pays out a small dividend.
But we shouldn't dismiss Himax out of the gate just because it's substantially smaller. One of the benefits of living outside of the market's radar is that Himax trades at a much lower top-line multiple. It fetches a 0.8 revenue multiple to its enterprise value, a lot less than NVIDIA at more than 13 times trailing revenue. Himax scores a point there, but it may not be enough.
Source Fool.com
