Novanta (NASDAQ:NOVT) and Amphenol (NYSE:APH) Head to Head Review

Amphenol (NYSE:APH) and Novanta (NASDAQ:NOVT) are both technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, analyst recommendations, risk, valuation, institutional ownership and earnings.

Analyst Recommendations

This is a breakdown of recent recommendations for Amphenol and Novanta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amphenol	0	2	15	1	2.94
Novanta	0	2	1	0	2.33

Amphenol currently has a consensus price target of $98.56, suggesting a potential upside of 24.24%. Novanta has a consensus price target of $194.00, suggesting a potential upside of 50.63%. Given Novanta’s higher possible upside, analysts clearly believe Novanta is more favorable than Amphenol.

Volatility & Risk

Amphenol has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500. Comparatively, Novanta has a beta of 1.72, suggesting that its share price is 72% more volatile than the S&P 500.

Earnings & Valuation

This table compares Amphenol and Novanta”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Amphenol	$29.01 billion	6.74	$4.27 billion	$2.00	39.66
Novanta	$1.03 billion	4.73	$53.83 million	$1.56	82.56

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Amphenol	17.73%	39.87%	14.80%
Novanta	6.00%	10.83%	7.53%

Insider & Institutional Ownership

97.0% of Amphenol shares are owned by institutional investors. Comparatively, 98.3% of Novanta shares are owned by institutional investors. 1.4% of Amphenol shares are owned by insiders. Comparatively, 1.2% of Novanta shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Amphenol beats Novanta on 11 of the 15 factors compared between the two stocks.

About Amphenol

Amphenol Corporation, together with its subsidiaries, primarily designs, manufactures, and markets electrical, electronic, and fiber optic connectors in the United States, China, and internationally. It operates through three segments: Harsh Environment Solutions, Communications Solutions, and Interconnect and Sensor Systems. The company offers connectors and connector systems, including harsh environment data, power, high-speed, fiber optic, and radio frequency interconnect products; busbars and power distribution systems; and other connectors. It also provides value-add products, such as backplane interconnect systems, cable assemblies and harnesses, and cable management products; other products comprising flexible and rigid printed circuit boards, hinges, other mechanical, and production related products. In addition, the company offers consumer device, network infrastructure, and other antennas; coaxial, power, and specialty cables; and sensors and sensor-based products. It sells its products through its sales force, independent representatives, and a network of electronics distributors to original equipment manufacturers, electronic manufacturing services companies, original design manufacturers, and service providers in the automotive, broadband communication, commercial aerospace, industrial, information technology and data communication, military, mobile device, and mobile network markets. Amphenol Corporation was founded in 1932 and is headquartered in Wallingford, Connecticut.

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.