Orbit International (OTCMKTS:ORBT) & Knowles (NYSE:KN) Critical Analysis

Knowles (NYSE:KN) and Orbit International (OTCMKTS:ORBT) are both technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitability, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Knowles and Orbit International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Knowles	0	2	2	1	2.80
Orbit International	0	0	0	0	0.00

Knowles presently has a consensus target price of $40.67, suggesting a potential upside of 15.32%. Given Knowles’ stronger consensus rating and higher probable upside, research analysts clearly believe Knowles is more favorable than Orbit International.

Insider and Institutional Ownership

96.3% of Knowles shares are owned by institutional investors. 2.2% of Knowles shares are owned by insiders. Comparatively, 11.3% of Orbit International shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Knowles and Orbit International”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Knowles	$593.20 million	5.08	$44.20 million	$0.77	45.80
Orbit International	$22.45 million	0.45	-$5.03 million	($1.44)	-2.00

Knowles has higher revenue and earnings than Orbit International. Orbit International is trading at a lower price-to-earnings ratio than Knowles, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Knowles has a beta of 1.59, meaning that its share price is 59% more volatile than the S&P 500. Comparatively, Orbit International has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500.

Profitability

This table compares Knowles and Orbit International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Knowles	10.63%	11.45%	8.33%
Orbit International	-21.42%	-41.21%	-22.03%

Summary

Knowles beats Orbit International on 14 of the 15 factors compared between the two stocks.

About Knowles

Knowles Corporation offers capacitors, radio frequency (RF) filtering products, balanced armature speakers, micro-acoustic microphones, and audio solutions in Asia, the United States, Europe, other Americas, and internationally. It operates through three segments: Precision Devices (PD); Medtech & Specialty Audio (MSA); and Consumer MEMS Microphones (CMM). The PD segment designs and delivers film, electrolytic, and mica capacitor products for use in power supplies and medical implants; electromagnetic interference filters; and RF filtering solutions for use in satellite communications and radar systems for defense applications. The MSA segment designs and manufactures balanced armature speakers and microphones for the hearing health, audio, and True Wireless Stereo (TWS) markets. The CMM segment designs and manufactures micro-electro-mechanical systems (MEMS) microphones and audio solutions used in applications that serve the ear, mobile, TWS, Internet of Things, computing, and smartphones markets. The company serves the defense, medtech, electric vehicle, industrial, communications, and consumer electronics markets through original equipment manufacturers, their contract manufacturers, suppliers, sales representatives, and distributors. Knowles Corporation was founded in 1946 and is headquartered in Itasca, Illinois.

About Orbit International

Orbit International Corp. engages in the design, manufacture, and sale of electronic components and subsystems, and commercial and custom power units for prime contractors, government procurement agencies, and research and development laboratories worldwide. The company operates in two segments, Electronics Group and Power Group. The Electronics Group segment designs, manufactures, and sells customized electronic components and subsystems. This segment offers remote control units, intercommunication panels, displays, keyboards, keypads and pointing devices, operator control trays, and command display units, as well as provides LCD display modules, military simulation and training bezels, electronic control assemblies, and multi-function displays design and enhancement services. The Power Group segment designs and manufactures commercial power units, AC power, frequency converters, uninterruptible power supplies, armament systems, and commercial-off-the-shelf power solutions, as well as inverters. The company was formerly known as Orbit Instrument Corp. and changed its name to Orbit International Corp. in July 1991. Orbit International Corp. was founded in 1957 and is based in Hauppauge, New York.