CTS (NYSE:CTS – Get Free Report) and CPS Technologies (NASDAQ:CPSH – Get Free Report) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their risk, profitability, earnings, dividends, institutional ownership, analyst recommendations and valuation.
Volatility and Risk
CTS has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500. Comparatively, CPS Technologies has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.
Profitability
This table compares CTS and CPS Technologies’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| CTS | 11.14% | 11.92% | 8.31% |
| CPS Technologies | -1.94% | -3.96% | -3.01% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| CTS | 0 | 1 | 0 | 0 | 2.00 |
| CPS Technologies | 1 | 1 | 1 | 0 | 2.00 |
CPS Technologies has a consensus price target of $6.00, suggesting a potential upside of 59.57%. Given CPS Technologies’ higher possible upside, analysts plainly believe CPS Technologies is more favorable than CTS.
Insider and Institutional Ownership
96.9% of CTS shares are owned by institutional investors. Comparatively, 11.2% of CPS Technologies shares are owned by institutional investors. 1.6% of CTS shares are owned by company insiders. Comparatively, 15.6% of CPS Technologies shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares CTS and CPS Technologies”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| CTS | $515.77 million | 2.59 | $58.11 million | $1.97 | 23.36 |
| CPS Technologies | $21.12 million | 3.20 | -$3.13 million | ($0.04) | -94.00 |
CTS has higher revenue and earnings than CPS Technologies. CPS Technologies is trading at a lower price-to-earnings ratio than CTS, indicating that it is currently the more affordable of the two stocks.
Summary
CTS beats CPS Technologies on 8 of the 13 factors compared between the two stocks.
About CTS
CTS Corporation manufactures and sells sensors, actuators, and connectivity components in North America, Europe, and Asia. The company provides encoders, rotary position sensors, slide potentiometers, industrial and commercial rotary potentiometers. It also provides non-contacting, and contacting pedals; and eBrake pedals. In addition, the company offers flow meters, hydrophones, non-destructive testing, sonar, ultrasonic imaging, piezoelectric materials, piezoelectric sense products, and bulk products. Further, it provides eMobility, chassis, current sensors, clutch, brake, position sensors, stroke sensor, seating, speed, throttle, transmission, turbo, temperature sensors, and technical related products. Additionally, the company offers DIP, rotary selector, tactile, rotary DIP, and toggle switches, as well as provides transducer related products. Furthermore, it provides EMI, RFI, and RFI products; specialty and resistors; and frequency control products. The company sells and markets its products through its sales engineers, independent manufacturer representatives, and distributors. CTS Corporation was founded in 1896 and is based in Lisle, Illinois.
About CPS Technologies
CPS Technologies Corporation provides advanced material solutions to the transportation, automotive, energy, computing/internet, telecommunication, aerospace, defense, and oil and gas markets in the United States, Europe, and Asia. The company offers metal matrix composites such as baseplates for various applications, including motor controllers used in electric trains, subway cars, wind turbines, and hybrid and electric vehicles; hermetic packages for use in radar, satellite, and avionics applications; baseplates and housings used in modules built with wide band gap semiconductors; and lids and heat spreaders for use in internet switches and routers. It also assembles housings and packages that includes metal matrix composite components for hybrid circuits; and produces armor for naval and military applications. The company sells its products to microelectronics systems companies. The company was formerly known as Ceramics Process Systems Corporation and changed its name to CPS Technologies Corporation in March 2007. CPS Technologies Corporation was incorporated in 1984 and is based in Norton, Massachusetts.
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