Analyzing nLight (NASDAQ:LASR) & IPG Photonics (NASDAQ:IPGP)

nLight (NASDAQ:LASR) and IPG Photonics (NASDAQ:IPGP) are both mid-cap technology companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, earnings, valuation, institutional ownership and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for nLight and IPG Photonics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
nLight	1	0	9	2	3.00
IPG Photonics	1	2	7	0	2.60

nLight currently has a consensus price target of $82.06, indicating a potential upside of 98.92%. IPG Photonics has a consensus price target of $131.33, indicating a potential upside of 93.76%. Given nLight’s stronger consensus rating and higher possible upside, equities analysts plainly believe nLight is more favorable than IPG Photonics.

Volatility and Risk

nLight has a beta of 2.46, indicating that its stock price is 146% more volatile than the S&P 500. Comparatively, IPG Photonics has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.

Valuation & Earnings

This table compares nLight and IPG Photonics”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
nLight	$317.72 million	7.56	-$23.47 million	($0.23)	-179.35
IPG Photonics	$1.00 billion	2.87	$31.10 million	$0.94	72.11

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

Profitability

This table compares nLight and IPG Photonics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
nLight	-4.02%	-1.03%	-0.85%
IPG Photonics	3.65%	3.91%	3.42%

Insider & Institutional Ownership

83.9% of nLight shares are owned by institutional investors. Comparatively, 93.8% of IPG Photonics shares are owned by institutional investors. 3.1% of nLight shares are owned by company insiders. Comparatively, 37.5% of IPG Photonics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

IPG Photonics beats nLight on 9 of the 15 factors compared between the two stocks.

About nLight

nLIGHT, Inc. develops and manufactures lasers and related photonics products for industrial, aerospace and defense applications. Its offerings include high-power semiconductor lasers, fiber lasers and ultrafast lasers, along with components and systems used to deliver and control laser energy. The company’s products support applications such as materials processing and other industrial tasks, as well as defense technologies including directed-energy systems. nLIGHT serves customers in the United States and international markets.

About IPG Photonics

IPG Photonics develops and manufactures fiber lasers, diode lasers, and optical amplifiers. Its products are used in materials processing applications such as cutting, welding, marking, and engraving, as well as in medical, communications, and other advanced applications. Founded in 1990 by physicist Valentin Gapontsev, the company helped establish fiber lasers as an alternative to other industrial laser technologies. IPG Photonics is headquartered in Oxford, Massachusetts, and serves customers around the world through its international operations and sales network.