AXT (NASDAQ:AXTI) vs. Nitto Denko (OTCMKTS:NDEKY) Critical Contrast
by Sarita Garza · The Markets DailyAXT (NASDAQ:AXTI – Get Free Report) and Nitto Denko (OTCMKTS:NDEKY – Get Free Report) are both technology companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.
Valuation and Earnings
This table compares AXT and Nitto Denko”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| AXT | $88.33 million | 45.76 | -$21.26 million | $0.02 | 3,082.00 |
| Nitto Denko | $6.83 billion | 2.19 | $886.83 million | $1.31 | 16.86 |
Nitto Denko has higher revenue and earnings than AXT. Nitto Denko is trading at a lower price-to-earnings ratio than AXT, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares AXT and Nitto Denko’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| AXT | 3.23% | 0.96% | 0.70% |
| Nitto Denko | 12.94% | 12.13% | 9.66% |
Volatility & Risk
AXT has a beta of 1.92, indicating that its share price is 92% more volatile than the S&P 500. Comparatively, Nitto Denko has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500.
Analyst Ratings
This is a breakdown of current ratings for AXT and Nitto Denko, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| AXT | 1 | 1 | 3 | 1 | 2.67 |
| Nitto Denko | 0 | 1 | 0 | 0 | 2.00 |
AXT presently has a consensus price target of $77.00, indicating a potential upside of 24.92%. Given AXT’s stronger consensus rating and higher probable upside, equities analysts plainly believe AXT is more favorable than Nitto Denko.
Institutional & Insider Ownership
49.5% of AXT shares are owned by institutional investors. 6.0% of AXT shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Summary
AXT beats Nitto Denko on 9 of the 15 factors compared between the two stocks.
About AXT
AXT, Inc. designs, develops, manufactures, and distributes compound and single element semiconductor substrates. The company offers indium phosphide for use in data center connectivity using light/lasers, high-speed data transfer in data centers, 5G communications, fiber optic lasers and detectors, consumer devices, passive optical networks, silicon photonics, photonic integrated circuits, thermo-photovoltaics, RF amplifier and switching, infrared light-emitting diode (LEDS) motion control, lidar for robotics and autonomous vehicles, and infrared thermal imaging. It also provides semi-insulating gallium arsenide (GaAs) substrates for use in Wi-Fi and IoT devices, transistors, direct broadcast television, power amplifiers, satellite communications, and solar cells; and semi-conducting GaAs substrates that are used in LEDs, screen displays using micro-LEDs, printer head lasers and LEDs, 3-D sensing using VCSELs, data center communication using VCSELs, sensors for industrial robotics/near-infrared sensors, optical couplers, solar cells, night vision goggles, lidar for robotics and autonomous vehicles, and other lasers, as well as laser machining, cutting, and drilling. In addition, the company offers germanium substrates for use in multi-junction solar cells for satellites, optical sensors and detectors, terrestrial concentrated photo voltaic cells, infrared detectors, and carrier wafer for LED. Further, it provides 6N+ and 7N+ purified gallium, boron trioxide, gallium-magnesium alloy, pyrolytic boron nitride (pBN) crucibles, and pBN insulating parts. It sells its products through direct salesforce in the United States, China, and Europe, as well as through independent sales representatives and distributors in Japan, Taiwan, Korea, and internationally. The company was formerly known as American Xtal Technology, Inc. and changed its name to AXT, Inc. in July 2000. AXT, Inc. was incorporated in 1986 and is headquartered in Fremont, California.
About Nitto Denko
Nitto Denko Corporation primarily engages in the adhesive tapes business in Japan, the Americas, Europe, Asia, and Oceania. It provides double sided tapes, surface protective films, sealing materials, masking tapes, membranes, FPD/touch panel related products, gasket materials, semiconductor manufacturing process products, flexible printed circuit boards, porous films/breathable materials, and packaging tapes. The company also offers functional thermal transfer systems, such as labels, barcode label printers, and label printing software; tapes for electrical and electronic equipment; dust removal products for clean rooms; fluoroplastic sheets and tapes, and fluoroplastic porous films; and materials for housing and construction. In addition, it provides medical products, including transdermal therapeutic systems, athletic tapes, medical adhesive tapes for wearable devices and body sensors, adhesive tapes, and particles for nucleic acid synthesis. The company offers its products to automotive and transportation, housing/housing equipment, infrastructure, material, home appliance and electrical, display, electronic device, medical, packaging, and consumer/personal care industries. Nitto Denko Corporation was incorporated in 1918 and is headquartered in Osaka, Japan.