Novanta (NASDAQ: NOVT) and AVX (NYSE:AVX) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, earnings, institutional ownership and profitability.
Valuation and Earnings
This table compares Novanta and AVX’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Novanta||$521.29 million||3.79||$60.05 million||$1.14||50.04|
|AVX||$1.31 billion||2.28||$125.78 million||$0.05||354.87|
AVX pays an annual dividend of $0.46 per share and has a dividend yield of 2.6%. Novanta does not pay a dividend. AVX pays out 920.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Novanta has raised its dividend for 5 consecutive years.
Volatility and Risk
Novanta has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500. Comparatively, AVX has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.
This is a summary of recent ratings for Novanta and AVX, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Novanta presently has a consensus price target of $54.00, indicating a potential downside of 5.35%. AVX has a consensus price target of $17.00, indicating a potential downside of 4.17%. Given AVX’s higher possible upside, analysts clearly believe AVX is more favorable than Novanta.
Institutional and Insider Ownership
82.7% of Novanta shares are owned by institutional investors. Comparatively, 24.7% of AVX shares are owned by institutional investors. 8.3% of Novanta shares are owned by insiders. Comparatively, 0.5% of AVX shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Novanta and AVX’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Novanta beats AVX on 12 of the 17 factors compared between the two stocks.
Novanta Company Profile
Novanta Inc., formerly GSI Group Inc., designs, develops, manufactures and sells precision photonic and motion control components and subsystems. The Company’s segments are Photonics, Vision and Precision Motion. The Photonics segment designs, manufactures and markets photonics-based solutions, including carbon dioxide (CO2) laser sources, laser scanning and laser beam delivery products, to customers around the world. The Vision Technologies segment designs, manufactures and markets a range of medical grade technologies, including visualization solutions, imaging informatics products, optical data collection and machine vision technologies, radio frequency identification (RFID) technologies, and thermal printers, to customers around the world. The Company’s Precision Motion segment designs, manufactures and markets optical encoders, precision motors and other motion control technology, air bearing spindles and precision machined components to customers around the world.
AVX Company Profile
AVX Corporation (AVX) is a manufacturer and supplier and reseller of a line of passive electronic components, interconnect devices and related products. AVX operates in three segments: Passive Components, Kyocera Electronic Devices (KED Resale) and Interconnect. The Passive Components segment consists of surface mount and leaded ceramic capacitors, surface mount and leaded tantalum capacitors, surface mount and leaded film capacitors, thick and thin film packages of multiple passive integrated components, thermistors, inductors and resistive products. The KED Resale segment consists of ceramic capacitors, frequency control devices, surface acoustic wave (SAW) devices, sensor products, radio frequency (RF) modules, actuators, acoustic devices and connectors produced by Kyocera and resold by AVX. The Interconnect segment consists primarily of AVX Interconnect automotive, telecom and memory connectors manufactured by AVX Interconnect or purchased from other manufacturers for resale.
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