Financial Analysis: Daktronics (NASDAQ:DAKT) vs. Nidec (OTCMKTS:NJDCY)

Daktronics (NASDAQ:DAKT) and Nidec (OTCMKTS:NJDCY) are both technology companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.

Volatility and Risk

Daktronics has a beta of 1.68, meaning that its share price is 68% more volatile than the S&P 500. Comparatively, Nidec has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500.

Profitability

This table compares Daktronics and Nidec’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Daktronics	5.41%	17.62%	9.41%
Nidec	N/A	N/A	N/A

Analyst Ratings

This is a summary of recent ratings for Daktronics and Nidec, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Daktronics	0	2	1	0	2.33
Nidec	0	3	0	0	2.00

Daktronics presently has a consensus price target of $29.00, indicating a potential upside of 51.56%. Given Daktronics’ stronger consensus rating and higher probable upside, analysts plainly believe Daktronics is more favorable than Nidec.

Earnings and Valuation

This table compares Daktronics and Nidec”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Daktronics	$838.71 million	1.10	$45.38 million	$0.91	21.03
Nidec	$17.12 billion	2.15	$1.11 billion	$0.26	14.81

Nidec has higher revenue and earnings than Daktronics. Nidec is trading at a lower price-to-earnings ratio than Daktronics, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

61.7% of Daktronics shares are held by institutional investors. Comparatively, 0.2% of Nidec shares are held by institutional investors. 4.6% of Daktronics shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Daktronics beats Nidec on 11 of the 14 factors compared between the two stocks.

About Daktronics

Daktronics, Inc. designs, manufactures, and sells electronic scoreboards, programmable display systems and large screen video displays for sporting, commercial, and transportation applications in the United States and internationally. It operates through Commercial, Live Events, High School Park and Recreation, Transportation, and International segments. The company also offers video display and walls; scoreboards and timing systems; LED message displays and sings; intelligent transportation systems dynamic message signs; mass transit display; sound systems; and digital billboards and street furniture, and digit and price displays. In addition, it provides indoor dynamic messaging systems and liquid crystal display signs; and software and controllers, which includes Venus, a control suite software to control the creation of messages and graphic sequences for uploading to displays. The company sells its products through direct sales and resellers. Daktronics, Inc. was founded in 1968 and is headquartered in Brookings, South Dakota.

About Nidec

Nidec Corporation, together with its subsidiaries, develops, manufactures, and sells motors, electronics and optical components, and other related products in Japan and internationally. The company offers medium- and large-size motors, small-size and precision motors, motor-related products, units and modules, automotive components, mechanical equipment/machine tools, inspection and measuring equipment, electronic devices, sensors, and other products, as well as mold, molding, cutting, and machining components. Its products are used for applications in robotics, IoT products, automotive components, home appliances, logistics/agriculture, information technology, office automation, mobile optical components, medical and health care products, housing equipment, commercial and professional products, industrial machinery, and processing/inspection equipment. The company was incorporated in 1973 and is headquartered in Kyoto, Japan..