Head to Head Survey: Cognex (NASDAQ:CGNX) & Yaskawa Electric (OTCMKTS:YASKY)

Cognex (NASDAQ:CGNX) and Yaskawa Electric (OTCMKTS:YASKY) are both technology companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Institutional and Insider Ownership

88.1% of Cognex shares are owned by institutional investors. 1.7% of Cognex shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Cognex and Yaskawa Electric, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cognex	0	4	10	2	2.88
Yaskawa Electric	0	2	2	3	3.14

Cognex currently has a consensus price target of $72.31, suggesting a potential upside of 7.22%. Given Cognex’s higher probable upside, equities research analysts clearly believe Cognex is more favorable than Yaskawa Electric.

Dividends

Cognex pays an annual dividend of $0.34 per share and has a dividend yield of 0.5%. Yaskawa Electric pays an annual dividend of $0.55 per share and has a dividend yield of 0.9%. Cognex pays out 40.5% of its earnings in the form of a dividend. Yaskawa Electric pays out 32.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Cognex has raised its dividend for 10 consecutive years. Yaskawa Electric is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Cognex	13.62%	10.89%	8.09%
Yaskawa Electric	6.11%	7.00%	4.20%

Risk and Volatility

Cognex has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500. Comparatively, Yaskawa Electric has a beta of 1.47, meaning that its share price is 47% more volatile than the S&P 500.

Valuation and Earnings

This table compares Cognex and Yaskawa Electric”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cognex	$994.36 million	11.29	$114.44 million	$0.84	80.29
Yaskawa Electric	$3.62 billion	2.24	$236.12 million	$1.70	36.70

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

Summary

Cognex beats Yaskawa Electric on 11 of the 18 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 Yaskawa Electric

YASKAWA Electric Corporation engages in motion control, robotics, system engineering, and other businesses worldwide. It manufactures and sells various AC drives, including general purpose AC drives, specific purpose AC drives, AC Drive for systems, regenerative energy saving units, and PM motors for use in household appliances, such as air conditioners and refrigerators; social infrastructures comprising elevators, escalators, trains, cranes, fans, and pumps; and factories that manufacture printing machinery, textile machinery, rubber machinery, and other materials. The company also offers rotary servo motors, direct drive servo motors, linear motors/linear sliders, machine controllers, positioning sensor encoders, and servo amplifiers for use in industrial robots, semiconductor manufacturing apparatus, machine tools, flat panel display manufacturing equipment, and metal working machines; and arc and spot welding, handling/assembling, collaborative, biomedical, palletizing, press handling, sealing/cutting/laser machining, deburring, painting, glass substrates transfer, and semiconductor wafer transfer robots for use in semiconductor wafer conveyance, arc welding, spot welding, handling, assembly, and palletizing applications. In addition, it provides industrial system electrical products, such as medium-voltage AC drives, system use AC drives, and system controllers for use in iron and steel systems, water and wastewater treatment, crane, and paper-making/film/port cargo handling/fiber/printing applications. Further, the company offers equipment for energy saving and creation comprising PV inverters, systems for large wind turbines, control equipment for small-scale power generation, and motor drive systems for use in photovoltaic power generation, large-scale wind power generation, small-scale power generation, and electric vehicles. The company was founded in 1915 and is headquartered in Kitakyushu, Japan.