Badger Meter (NYSE: BMI) and Perceptron (NASDAQ:PRCP) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, profitabiliy, institutional ownership, risk, dividends, valuation and earnings.

Institutional and Insider Ownership

84.4% of Badger Meter shares are held by institutional investors. Comparatively, 63.1% of Perceptron shares are held by institutional investors. 4.5% of Badger Meter shares are held by insiders. Comparatively, 10.3% of Perceptron shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Badger Meter and Perceptron’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Badger Meter $395.15 million 3.30 $77.75 million $1.17 38.29
Perceptron $74.37 million 0.91 $4.99 million ($1.70) -4.24

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Badger Meter and Perceptron, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Badger Meter 0 2 1 0 2.33
Perceptron 0 0 2 0 3.00

Badger Meter currently has a consensus price target of $44.50, suggesting a potential downside of 0.67%. Perceptron has a consensus price target of $8.50, suggesting a potential upside of 17.89%. Given Perceptron’s stronger consensus rating and higher probable upside, analysts plainly believe Perceptron is more favorable than Badger Meter.

Profitability

This table compares Badger Meter and Perceptron’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Badger Meter 8.67% 13.19% 9.52%
Perceptron -21.55% 2.32% 1.34%

Volatility & Risk

Badger Meter has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500. Comparatively, Perceptron has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500.

Dividends

Badger Meter pays an annual dividend of $0.46 per share and has a dividend yield of 1.0%. Perceptron does not pay a dividend. Badger Meter pays out 39.3% of its earnings in the form of a dividend. Perceptron has increased its dividend for 15 consecutive years.

Summary

Badger Meter beats Perceptron on 10 of the 17 factors compared between the two stocks.

Badger Meter Company Profile

Badger Meter, Inc. is a manufacturer and marketer of products incorporating flow measurement, control and communication solutions, serving water utilities, municipalities, and commercial and industrial customers around the world. The Company’s products measure water, oil, chemicals and other fluids, provide and communicate timely measurement data. Its product lines include two categories: sales of water meters and related technologies to municipal water utilities (municipal water), and sales of meters to various industries for water and other fluids (flow instrumentation). The municipal water offering includes mechanical and ultrasonic (electronic) water meters and related technologies and services used by water utilities as the basis for generating water and wastewater. The flow instrumentation category includes the sale of meters and valves around the world to measure and control materials flowing through a pipe or pipeline, including air, steam, oil, and other liquids and gases.

Perceptron Company Profile

Perceptron, Inc. develops, produces and sells a range of automated industrial metrology products and solutions to manufacturing organizations for dimensional gauging, dimensional inspection and three-dimensional (3D) scanning. The Company’s products include 3D machine vision solutions, robot guidance, coordinate measuring machines (CMMs), laser scanning and advanced analysis software. The Company’s products are categorized as In-Line, Near-Line and Off-Line Measurement Solutions (Measurement Solutions); 3D Scanning Solutions, and Value Added Services. Its In-Line and Near-Line measurement solutions include AutoGauge, AutoFit, AutoScan, AutoGuide and Helix. Its Off-Line measurement solutions include Coord3 and TouchDMIS. Its 3D Scanning Solutions include ScanWorks, ScanR and WheelWorks. Its Value Added Services include training, field service, calibration, launch support services, maintenance agreements and repairs. The Company operates in the Americas, Europe and Asia.

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