Allied Motion Technologies (NASDAQ: AMOT) and Cognex Corporation (NASDAQ:CGNX) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, profitabiliy, risk, valuation and analyst recommendations.

Dividends

Allied Motion Technologies pays an annual dividend of $0.10 per share and has a dividend yield of 0.4%. Cognex Corporation pays an annual dividend of $0.34 per share and has a dividend yield of 0.4%. Allied Motion Technologies pays out 10.5% of its earnings in the form of a dividend. Cognex Corporation pays out 16.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Allied Motion Technologies is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

38.9% of Allied Motion Technologies shares are owned by institutional investors. Comparatively, 88.7% of Cognex Corporation shares are owned by institutional investors. 30.8% of Allied Motion Technologies shares are owned by insiders. Comparatively, 5.6% of Cognex Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for Allied Motion Technologies and Cognex Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allied Motion Technologies 0 1 0 0 2.00
Cognex Corporation 0 5 4 0 2.44

Cognex Corporation has a consensus target price of $71.29, suggesting a potential downside of 21.84%. Given Cognex Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Cognex Corporation is more favorable than Allied Motion Technologies.

Profitability

This table compares Allied Motion Technologies and Cognex Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allied Motion Technologies 3.62% 11.99% 4.85%
Cognex Corporation 32.23% 18.99% 17.54%

Volatility & Risk

Allied Motion Technologies has a beta of 1.84, indicating that its share price is 84% more volatile than the S&P 500. Comparatively, Cognex Corporation has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500.

Earnings & Valuation

This table compares Allied Motion Technologies and Cognex Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Allied Motion Technologies $243.57 million 1.04 $27.65 million $0.95 28.20
Cognex Corporation $559.49 million 14.13 $197.09 million $2.04 44.71

Cognex Corporation has higher revenue and earnings than Allied Motion Technologies. Allied Motion Technologies is trading at a lower price-to-earnings ratio than Cognex Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Cognex Corporation beats Allied Motion Technologies on 12 of the 16 factors compared between the two stocks.

About Allied Motion Technologies

Allied Motion Technologies Inc. designs, manufactures and sells precision and specialty motion control components and systems used in a range of industries. The Company serves various markets, including vehicle, medical, aerospace and defense, electronics and industrial. It focuses on motion control applications. It is engaged in developing electro-magnetic, mechanical and electronic motion technology. It operates in the design and manufacture of motion control products, marketed to original equipment manufacturers and end users segment. Its products are used in the handling, inspection, and testing of components and final products, such as printers, tunable lasers and spectrum analyzers for the fiber optic industry, and test and processing equipment for the semiconductor manufacturing industry. Its products are used in a range of medical, industrial and commercial aviation applications, such as dialysis equipment, industrial ink jet printers and cash dispensers.

About Cognex Corporation

Cognex Corporation (Cognex) is a provider of machine vision products that capture and analyze visual information in order to automate tasks, primarily in manufacturing processes, where vision is required. The Company operates through the machine vision technology segment. The Company’s machine vision products are used to automate the manufacture and tracking of discrete items, such as mobile phones, aspirin bottles and automobile tires, by locating, identifying, inspecting and measuring them during the manufacturing or distribution process. The Company’s products include vision software, vision systems, vision sensors and identification (ID) products. Its products range from vision sensors that are integrated, to personal computer (PC)-based systems for users. Its products also have a range of physical forms, depending upon the user’s need. Cognex sells its products through a direct sales force, as well as through a global network of integration and distribution partners.

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