Head-To-Head Comparison: CPS Technologies (NASDAQ:CPSH) versus Novanta (NASDAQ:NOVT)

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

Insider and Institutional Ownership

11.2% of CPS Technologies shares are held by institutional investors. Comparatively, 98.4% of Novanta shares are held by institutional investors. 13.2% of CPS Technologies shares are held by insiders. Comparatively, 1.2% of Novanta shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares CPS Technologies and Novanta”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CPS Technologies	$32.60 million	2.86	$420,000.00	$0.03	172.33
Novanta	$980.60 million	4.81	$53.83 million	$1.46	90.60

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

Analyst Ratings

This is a breakdown of recent ratings for CPS Technologies and Novanta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CPS Technologies	1	1	1	0	2.00
Novanta	0	2	1	0	2.33

CPS Technologies presently has a consensus price target of $6.00, suggesting a potential upside of 16.05%. Novanta has a consensus price target of $144.00, suggesting a potential upside of 8.86%. Given CPS Technologies’ higher probable upside, equities analysts plainly believe CPS Technologies is more favorable than Novanta.

Volatility and Risk

CPS Technologies has a beta of 1.46, meaning that its stock price is 46% more volatile than the S&P 500. Comparatively, Novanta has a beta of 1.64, meaning that its stock price is 64% more volatile than the S&P 500.

Profitability

This table compares CPS Technologies and Novanta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CPS Technologies	1.29%	2.43%	1.90%
Novanta	5.49%	13.12%	7.79%

Summary

Novanta beats CPS Technologies on 10 of the 13 factors compared between the two stocks.

About CPS Technologies

CPS Technologies Corporation provides advanced material solutions to the transportation, automotive, energy, computing/internet, telecommunication, aerospace, defense, and oil and gas markets in the United States, Europe, and Asia. The company offers metal matrix composites such as baseplates for various applications, including motor controllers used in electric trains, subway cars, wind turbines, and hybrid and electric vehicles; hermetic packages for use in radar, satellite, and avionics applications; baseplates and housings used in modules built with wide band gap semiconductors; and lids and heat spreaders for use in internet switches and routers. It also assembles housings and packages that includes metal matrix composite components for hybrid circuits; and produces armor for naval and military applications. The company sells its products to microelectronics systems companies. The company was formerly known as Ceramics Process Systems Corporation and changed its name to CPS Technologies Corporation in March 2007. CPS Technologies Corporation was incorporated in 1984 and is based in Norton, Massachusetts.

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.