Novanta (NASDAQ:NOVT – Get Free Report) and Neonode (NASDAQ:NEON – Get Free Report) are both technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.
Profitability
This table compares Novanta and Neonode’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Novanta | 6.00% | 10.83% | 7.53% |
| Neonode | 397.84% | -32.35% | -28.42% |
Earnings & Valuation
This table compares Novanta and Neonode”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Novanta | $980.60 million | 5.40 | $53.83 million | $1.56 | 89.78 |
| Neonode | $2.06 million | 6.78 | $8.49 million | ($0.33) | -2.52 |
Novanta has higher revenue and earnings than Neonode. Neonode is trading at a lower price-to-earnings ratio than Novanta, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Novanta has a beta of 1.67, meaning that its stock price is 67% more volatile than the S&P 500. Comparatively, Neonode has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500.
Institutional and Insider Ownership
98.3% of Novanta shares are held by institutional investors. Comparatively, 11.6% of Neonode shares are held by institutional investors. 1.2% of Novanta shares are held by company insiders. Comparatively, 21.9% of Neonode shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Analyst Recommendations
This is a summary of recent ratings for Novanta and Neonode, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Novanta | 0 | 1 | 1 | 1 | 3.00 |
| Neonode | 1 | 0 | 0 | 0 | 1.00 |
Novanta currently has a consensus price target of $194.00, indicating a potential upside of 38.52%. Given Novanta’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Novanta is more favorable than Neonode.
Summary
Novanta beats Neonode on 12 of the 15 factors compared between the two stocks.
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.
About Neonode
Neonode Inc., together with its subsidiaries, develops optical sensing solutions for contactless touch, touch, and gesture sensing in the United States, Japan, South Korea, Germany, Switzerland, France, Sweden, China, and internationally. It also offers software solutions for machine perception to detect and track persons and objects in video streams from cameras and other types of imagers. In addition, the company sells touch sensor modules to OEMs, original design manufacturers, and systems integrators. Further, it licenses its zForce technology to original equipment manufacturers and automotive Tier 1 suppliers, as well as provides non-recurring engineering services related to application development. It serves office equipment, automotive, industrial automation, medical, military, and avionics markets. Neonode Inc. was incorporated in 1997 and is headquartered in Stockholm, Sweden.
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