Head-To-Head Review: TT Electronics (OTCMKTS:TTGPF) versus Novanta (NASDAQ:NOVT)

TT Electronics (OTCMKTS:TTGPF) and Novanta (NASDAQ:NOVT) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares TT Electronics and Novanta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TT Electronics	N/A	N/A	N/A
Novanta	6.41%	14.70%	7.88%

Risk & Volatility

TT Electronics has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Novanta has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500.

Insider and Institutional Ownership

98.4% of Novanta shares are held by institutional investors. 1.2% of Novanta shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares TT Electronics and Novanta”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TT Electronics	$665.93 million	0.37	-$68.24 million	N/A	N/A
Novanta	$949.24 million	4.04	$64.09 million	$1.70	62.71

Novanta has higher revenue and earnings than TT Electronics.

Analyst Recommendations

This is a summary of current recommendations and price targets for TT Electronics and Novanta, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TT Electronics	0	2	0	0	2.00
Novanta	0	3	0	0	2.00

Novanta has a consensus target price of $133.00, suggesting a potential upside of 24.75%. Given Novanta’s higher possible upside, analysts plainly believe Novanta is more favorable than TT Electronics.

Summary

Novanta beats TT Electronics on 10 of the 10 factors compared between the two stocks.

About TT Electronics

TT Electronics plc provides design-led advanced electronics technologies for performance critical applications in the healthcare, aerospace and defense, and automation and electrification markets in the United Kingdom, Rest of Europe, North America, Asia, and internationally. The company operates through three segments: Power and Connectivity, Global Manufacturing Solutions, and Sensors and Specialist Components. The Power and Connectivity segment designs and manufactures power application products and connectivity devices, which enable the capture and wireless transfer of data to optimize electronic systems. The Global Manufacturing Solutions segment provides manufacturing services and engineering solutions for its product divisions and to customers that require a lower volume and higher mix of various products. This segment manufactures integrated product assemblies, as well as provides engineering services, including designing testing solutions and value-engineering. The Sensors and Specialist Components segment develops standard and customized solutions, including sensors and power management devices. Its solutions enhance the precision, speed, and reliability of critical aspects of its customers applications. It offers its products and services under the AB Connectors, Aero Stanrew, BI Technologies, Ferranti, IRC, Optek Technology, Precision, Power Partners, PowerPax, Roxspur Measurement and Control, Semelab, Stontronics, Torotel, and Welwyn brands. The company was formerly known as TT Group plc and changed its name to TT Electronics plc in 2000. The company was incorporated in 1906 and is headquartered in Woking, the United Kingdom.

About Novanta

Novanta, Inc. engages in the provision of core technology solutions to healthcare and advanced industrial original equipment manufacturers. It operates through the following segments: Photonics, Vision, and Precision Motion. The Photonics segment designs, manufactures, and markets photonics-based solutions, including laser scanning and laser beam delivery, CO2 laser, continuous wave and ultrafast laser, and optical light engine products. The Vision segment offers a range of medical grade technologies, including medical insufflators, pumps and related disposables, surgical displays and operating room integration technologies, optical data collection and machine vision technologies, radio frequency identification technologies, thermal printers, spectrometry technologies, and embedded touch screen solutions. The Precision Motion segment includes optical encoders, precision motor and motion control technology, air bearing spindles, and precision machined components to customers. The company was founded in 1968 and is headquartered in Bedford, MA.