American Superconductor (NASDAQ: AMSC) and Orbotech (NASDAQ:ORBK) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, risk, profitability, valuation, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of current recommendations for American Superconductor and Orbotech, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
American Superconductor 0 1 5 0 2.83
Orbotech 0 1 7 0 2.88

American Superconductor currently has a consensus target price of $7.33, indicating a potential upside of 120.22%. Orbotech has a consensus target price of $50.38, indicating a potential downside of 0.56%. Given American Superconductor’s higher possible upside, analysts clearly believe American Superconductor is more favorable than Orbotech.

Earnings and Valuation

This table compares American Superconductor and Orbotech’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
American Superconductor $75.19 million 0.93 -$27.37 million ($1.99) -1.67
Orbotech $806.40 million 3.01 $79.43 million $2.10 24.12

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

Profitability

This table compares American Superconductor and Orbotech’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
American Superconductor -50.90% -58.10% -34.66%
Orbotech 11.89% 15.72% 10.97%

Institutional & Insider Ownership

28.4% of American Superconductor shares are owned by institutional investors. Comparatively, 66.1% of Orbotech shares are owned by institutional investors. 2.6% of American Superconductor shares are owned by insiders. Comparatively, 10.4% of Orbotech shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

American Superconductor has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500. Comparatively, Orbotech has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.

Summary

Orbotech beats American Superconductor on 11 of the 13 factors compared between the two stocks.

About American Superconductor

American Superconductor Corporation (AMSC) is a provider of megawatt-scale solutions. The Company operates through two segments: Wind and Grid. Through the Company’s Windtec Solutions brand, the Wind business segment enables manufacturers to field wind turbines. Through the Company’s Gridtec Solutions, the Grid business segment enables electric utilities and renewable energy project developers to connect, transmit and distribute power. AMSC supplies power electronics and control systems, licenses its engineered wind turbine designs and provides customer support services to wind turbine manufacturers. The Company provides a range of power electronics and software-based control systems. AMSC provides transmission planning services that enable it to identify power grid congestion and other risks. The Company also sells grid interconnection solutions for wind farms and solar power plants, power quality systems, and transmission and distribution cable systems.

About Orbotech

Orbotech Ltd. is a supplier of yield-enhancing and process-enabling solutions for the manufacture of electronics products. The Company provides cutting-edge solutions for use in the manufacture of printed circuit boards (PCBs), flat panel displays (FPDs) and semiconductor devices (SDs). The Company’s segments include Production Solutions for the Electronics Industry, Solar Energy and Recognition Software. The Production Solutions for the Electronics Industry segment is engaged in the design, development, manufacture, marketing and service of yield-enhancing and process-enabling solutions for the manufacture of electronics products. The Solar Energy segment is engaged in the design, development, manufacture and marketing of solar photovoltaic energy systems that produce electricity directly from sunlight. The Recognition Software segment is engaged in the development and marketing of check processing and healthcare payment automation solutions.

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