Cognex (NASDAQ:CGNX) & Itron (NASDAQ:ITRI) Financial Analysis

Cognex (NASDAQ:CGNX) and Itron (NASDAQ:ITRI) are both mid-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Risk & Volatility

Cognex has a beta of 1.47, indicating that its stock price is 47% more volatile than the S&P 500. Comparatively, Itron has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500.

Earnings and Valuation

This table compares Cognex and Itron”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cognex	$914.52 million	6.25	$106.17 million	$0.68	50.10
Itron	$2.44 billion	2.55	$239.10 million	$5.48	24.89

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

Profitability

This table compares Cognex and Itron’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cognex	12.80%	6.37%	4.81%
Itron	10.34%	19.65%	8.04%

Insider and Institutional Ownership

88.1% of Cognex shares are owned by institutional investors. Comparatively, 96.2% of Itron shares are owned by institutional investors. 1.6% of Cognex shares are owned by company insiders. Comparatively, 1.5% of Itron shares are owned by company 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.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Cognex and Itron, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cognex	1	6	7	1	2.53
Itron	0	2	8	0	2.80

Cognex presently has a consensus target price of $41.62, suggesting a potential upside of 22.15%. Itron has a consensus target price of $132.00, suggesting a potential downside of 3.22%. Given Cognex’s higher possible upside, analysts plainly believe Cognex is more favorable than Itron.

Summary

Itron beats Cognex on 8 of the 15 factors compared between the two stocks.

About Cognex

Cognex Corporation provides machine vision products that capture and analyze visual information to automate manufacturing and distribution tasks worldwide. Its machine vision products are used to automate the manufacturing and tracking of discrete items, including mobile phones, electric vehicle batteries, and e-commerce packages by locating, identifying, inspecting, and measuring them during the manufacturing or distribution process. The company offers VisionPro software, a suite of patented vision tools for advanced programming; QuickBuild that allows customers to build vision applications with a graphical, flowchart-based programming interface; and Cognex deep learning vision software. It also provides a range of inspection tasks, including part location, identification, measurement, assembly verification, and robotic guidance; vision sensors for vision applications, such as checking the presence and size of parts; and the In-Sight product line of vision systems and sensors. In addition, the company offers DataMan, an image-based barcode readers and barcode verifiers. It sells its products to automotive, logistics, consumer electronics, medical-related, semiconductor, consumer products, food and beverage, and others, as well as through a network of distributors and integrators. The company was incorporated in 1981 and is headquartered in Natick, Massachusetts.

About Itron

Itron, Inc., a technology, solutions, and service company, provides end-to-end solutions that help manage energy, water, and smart city operations worldwide. It operates in three segments: Device Solutions, Networked Solutions, and Outcomes. The Device Solutions segment offers hardware products that are used for measurement, control, or sensing, such as standard gas, electricity, water, and communicating meters, as well as heat and allocation products. The Networked Solutions segment provides communicating devices, such as smart meters, modules, endpoints, and sensors; network infrastructure; and associated heat-end management and application software for acquiring and transporting application-specific data. This segment also offers industrial internet of things solutions. Including automated meter reading; advanced metering infrastructure for electricity, water, and gas; distributed energy resource management; smart grid and distribution automation; smart street lighting; and leak detection and applications for gas and water systems. The Outcomes segment provides value-added, enhanced software and services, artificial intelligence, and machine learning for managing, organizing, analyzing, and interpreting data to enhance decision making, maximize operational profitability, resource efficiency, grid analytics, and deliver results for consumers, utilities, and smart cities. In addition, it offers implementation, project management, installation, consulting, and post-sale maintenance support services, as well as cloud and software-as-a-service; and extended or customer-specific warranties. The company offers its products and services under the Itron brand. It serves utility and smart city customers, and municipalities through its sales force, distributors, agents, partners, and meter manufacturer representatives. Itron, Inc. was incorporated in 1977 and is headquartered in Liberty Lake, Washington.