Amtech Systems (NASDAQ: ASYS) and Altra Industrial Motion Corp. (NASDAQ:AIMC) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, risk, profitability, valuation, dividends, institutional ownership and analyst recommendations.

Insider and Institutional Ownership

50.0% of Amtech Systems shares are owned by institutional investors. Comparatively, 98.3% of Altra Industrial Motion Corp. shares are owned by institutional investors. 34.6% of Amtech Systems shares are owned by company insiders. Comparatively, 3.2% of Altra Industrial Motion Corp. shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Altra Industrial Motion Corp. pays an annual dividend of $0.68 per share and has a dividend yield of 1.4%. Amtech Systems does not pay a dividend. Altra Industrial Motion Corp. pays out 59.1% of its earnings in the form of a dividend.

Profitability

This table compares Amtech Systems and Altra Industrial Motion Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Amtech Systems 1.00% 2.34% 1.18%
Altra Industrial Motion Corp. 4.17% 16.50% 6.29%

Earnings and Valuation

This table compares Amtech Systems and Altra Industrial Motion Corp.’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Amtech Systems $152.25 million 1.08 $4.90 million $0.12 102.50
Altra Industrial Motion Corp. $784.57 million 1.80 $110.94 million $1.15 41.96

Altra Industrial Motion Corp. has higher revenue and earnings than Amtech Systems. Altra Industrial Motion Corp. is trading at a lower price-to-earnings ratio than Amtech Systems, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Amtech Systems has a beta of 2.03, indicating that its stock price is 103% more volatile than the S&P 500. Comparatively, Altra Industrial Motion Corp. has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Amtech Systems and Altra Industrial Motion Corp., as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Amtech Systems 0 0 3 0 3.00
Altra Industrial Motion Corp. 0 1 2 0 2.67

Amtech Systems presently has a consensus price target of $12.50, indicating a potential upside of 1.63%. Altra Industrial Motion Corp. has a consensus price target of $46.50, indicating a potential downside of 3.63%. Given Amtech Systems’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Amtech Systems is more favorable than Altra Industrial Motion Corp..

Summary

Altra Industrial Motion Corp. beats Amtech Systems on 9 of the 16 factors compared between the two stocks.

Amtech Systems Company Profile

Amtech Systems, Inc. is engaged in the manufacture of capital equipment, including thermal processing, silicon wafer handling automation and related consumables used in fabricating solar cells, Light Emitting Diode (LED) and semiconductor devices. The Company operates through three business segments: solar, semiconductor and polishing. The solar segment supplies thermal processing systems, including diffusion; plasma-enhanced chemical vapor deposition (PECVD); atomic layer deposition (ALD), and related automation, parts and services to the solar/photovoltaic industry. The semiconductor segment supplies thermal processing equipment, including solder reflow equipment and related controls for use by the semiconductor manufacturers and in electronics assembly for automotive and other industries. The polishing supplies segment produces consumables and machinery for lapping (fine abrading) and polishing of materials, such as sapphire substrates and optical components.

Altra Industrial Motion Corp. Company Profile

Altra Industrial Motion Corp. is a designer, producer and marketer of a range of mechanical power transmission (MPT) components. The Company operates through three segments: Couplings, Clutches and Brakes; Electromagnetic Clutches and Brakes, and Gearing. It manufactures a range of couplings suitable for various industrial and specialty applications. The Electromagnetic Clutches and Brakes segment products include brakes and clutches that are used to electronically slow, stop, engage or disengage equipment utilizing electromagnetic friction type connections. The Gearing segment product lines include vertical and horizontal gear drives, speed reducers and increasers, high-speed compressor drives, enclosed custom gear drives, various enclosed gear drive and gear motor configurations, and open gearing products, such as spur, helical, worm and miter/bevel gears. Its products are used to control and transmit power and torque in virtually any industrial application involving movement.

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