Contrasting Novanta (NOVT) and Its Competitors

Novanta (NASDAQ: NOVT) is one of 24 publicly-traded companies in the “Electronic Component” industry, but how does it compare to its peers? We will compare Novanta to related companies based on the strength of its valuation, institutional ownership, risk, dividends, analyst recommendations, earnings and profitability.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Novanta and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Novanta 0 0 1 0 3.00
Novanta Competitors 39 255 501 10 2.60

Novanta currently has a consensus target price of $54.00, suggesting a potential downside of 8.78%. As a group, “Electronic Component” companies have a potential downside of 7.07%. Given Novanta’s peers higher possible upside, analysts plainly believe Novanta has less favorable growth aspects than its peers.

Earnings & Valuation

This table compares Novanta and its peers gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Novanta $384.76 million $22.00 million 43.53
Novanta Competitors $1.21 billion $130.70 million 80.89

Novanta’s peers have higher revenue and earnings than Novanta. Novanta is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Institutional and Insider Ownership

79.0% of Novanta shares are held by institutional investors. Comparatively, 56.6% of shares of all “Electronic Component” companies are held by institutional investors. 8.3% of Novanta shares are held by company insiders. Comparatively, 9.0% of shares of all “Electronic Component” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Novanta and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Novanta 12.45% 18.29% 9.56%
Novanta Competitors -3.13% -1.96% 0.72%

Volatility and Risk

Novanta has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Novanta’s peers have a beta of 1.03, suggesting that their average share price is 3% more volatile than the S&P 500.

Summary

Novanta beats its peers on 7 of the 13 factors compared.

About Novanta

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.

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