Kemet Corporation (NYSE: KEM) and Novanta (NASDAQ:GSIG) are both computer and technology companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, institutional ownership, profitabiliy, valuation, analyst recommendations, risk and dividends.

Analyst Recommendations

This is a breakdown of recent ratings for Kemet Corporation and Novanta, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kemet Corporation 0 1 1 0 2.50
Novanta 0 0 0 0 N/A

Kemet Corporation currently has a consensus target price of $18.13, suggesting a potential downside of 5.89%. Given Kemet Corporation’s higher probable upside, equities analysts clearly believe Kemet Corporation is more favorable than Novanta.

Valuation and Earnings

This table compares Kemet Corporation and Novanta’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Kemet Corporation $846.86 million 1.08 $110.50 million $4.88 3.95
Novanta N/A N/A N/A N/A N/A

Kemet Corporation has higher revenue and earnings than Novanta.

Profitability

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

Net Margins Return on Equity Return on Assets
Kemet Corporation 33.25% 32.96% 5.21%
Novanta 31.45% 49.68% 28.61%

Insider and Institutional Ownership

56.9% of Kemet Corporation shares are held by institutional investors. 3.9% of Kemet Corporation 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.

Summary

Kemet Corporation beats Novanta on 6 of the 8 factors compared between the two stocks.

Kemet Corporation Company Profile

KEMET Corporation (KEMET) is a manufacturer of passive electronic components. The Company operates in two segments: Solid Capacitors, and Film and Electrolytic. The Solid Capacitors segment primarily produces tantalum, aluminum, polymer and ceramic capacitors. Solid Capacitors also produces tantalum powder used in the production of tantalum capacitors. The Film and Electrolytic Business Group produces film, paper and wet aluminum electrolytic capacitors. It also designs and produces EMI Filters. The Company’s product offerings include surface mount, which are attached directly to the circuit board; leaded capacitors, which are attached to the circuit board using lead wires, and chassis-mount and other pin-through-hole board-mount capacitors, which utilize attachment methods, such as screw terminal and snap-in. The Company sells its products to a range of original equipment manufacturers (OEMs) and electronics manufacturing services (EMS) providers.

Novanta Company Profile

Novanta Inc., formerly GSI Group Inc., designs, develops, manufactures and sells precision photonic and motion control components and subsystems. The Company’s segments are Photonics, Vision and Precision Motion. The Photonics segment designs, manufactures and markets photonics-based solutions, including carbon dioxide (CO2) laser sources, laser scanning and laser beam delivery products, to customers around the world. The Vision Technologies segment designs, manufactures and markets a range of medical grade technologies, including visualization solutions, imaging informatics products, optical data collection and machine vision technologies, radio frequency identification (RFID) technologies, and thermal printers, to customers around the world. The Company’s Precision Motion segment designs, manufactures and markets optical encoders, precision motors and other motion control technology, air bearing spindles and precision machined components to customers around the world.

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