Nortech Systems (NASDAQ:NSYS) and IMPINJ (NASDAQ:PI) are both small-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Analyst Ratings

This is a summary of current ratings and target prices for Nortech Systems and IMPINJ, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nortech Systems 0 0 0 0 N/A
IMPINJ 0 4 2 0 2.33

IMPINJ has a consensus price target of $19.75, indicating a potential upside of 10.15%. Given IMPINJ’s higher probable upside, analysts clearly believe IMPINJ is more favorable than Nortech Systems.

Profitability

This table compares Nortech Systems and IMPINJ’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nortech Systems -1.90% 1.00% 0.37%
IMPINJ -33.58% -20.18% -14.43%

Insider and Institutional Ownership

2.5% of Nortech Systems shares are owned by institutional investors. Comparatively, 64.5% of IMPINJ shares are owned by institutional investors. 6.2% of Nortech Systems shares are owned by company insiders. Comparatively, 26.0% of IMPINJ shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Nortech Systems and IMPINJ’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nortech Systems $112.33 million 0.11 -$2.44 million N/A N/A
IMPINJ $125.30 million 3.07 -$17.32 million ($0.29) -61.83

Nortech Systems has higher earnings, but lower revenue than IMPINJ.

Volatility and Risk

Nortech Systems has a beta of 0.51, suggesting that its stock price is 49% less volatile than the S&P 500. Comparatively, IMPINJ has a beta of 2.1, suggesting that its stock price is 110% more volatile than the S&P 500.

Summary

IMPINJ beats Nortech Systems on 7 of the 12 factors compared between the two stocks.

About Nortech Systems

Nortech Systems Incorporated operates as an electronic manufacturing services company in the United States, Mexico, and China. The company provides value-added engineering, technical and manufacturing, and support services, including project management, designing, testing, prototyping, supply chain management, and post-market services. It offers manufacturing and engineering services for medical devices, as well as printed circuit board, wire and cable, and higher level electromechanical assemblies. The company also provides repair services. It serves original equipment manufacturers in the aerospace and defense, medical, and industrial markets through business development teams and independent manufacturers' representatives. The company was founded in 1981 and is headquartered in Maple Grove, Minnesota.

About IMPINJ

Impinj, Inc. operates a platform that enables wireless connectivity to everyday items by delivering each item's unique identity, location, and authenticity to business and consumer applications. The company's platform includes endpoint integrated circuits (ICs) product, a miniature radios-on-a-chip, which attach-to and identify their host items; and connectivity layer that comprises readers, gateways, and reader ICs to wirelessly identify, locate, authenticate, and engage endpoints via RAIN, as well as provide power to and communicate bidirectionally with endpoint ICs. Its platform also consists of software layer that comprises ItemSense, an operating system for platform. In addition, the company's platform connects everyday items, such as apparel, medical supplies, automobile parts, drivers' licenses, food, and luggage to consumer and business applications, including inventory management, patient safety, asset tracking, and item authentication, as well as delivers real-time information to businesses about items they create, manage, transport, and sell. It primarily serves retail, healthcare, supply chain and logistics, airline, automotive, industrial and manufacturing, consumer experience, food, datacenter, travel, banking, and linen and uniform tracking sectors through distributors, system integrators, value-added resellers, and software solution partners in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. Impinj, Inc. was founded in 2000 and is headquartered in Seattle, Washington.

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