Novanta (NASDAQ:NOVT) and Kyocera (OTCMKTS:KYOCY) Critical Review

Kyocera (OTCMKTS:KYOCY) and Novanta (NASDAQ:NOVT) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, institutional ownership, analyst recommendations, risk, valuation, dividends and profitability.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Kyocera	1.30%	0.79%	0.57%
Novanta	6.41%	14.70%	7.88%

Analyst Ratings

This is a breakdown of recent ratings for Kyocera and Novanta, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kyocera	0	1	0	0	2.00
Novanta	1	2	0	0	1.67

Novanta has a consensus price target of $133.00, suggesting a potential upside of 26.13%. Given Novanta’s higher possible upside, analysts clearly believe Novanta is more favorable than Kyocera.

Volatility and Risk

Kyocera has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500. Comparatively, Novanta has a beta of 1.54, meaning that its share price is 54% more volatile than the S&P 500.

Insider & Institutional Ownership

7.4% of Kyocera shares are owned by institutional investors. Comparatively, 98.3% of Novanta shares are owned by institutional investors. 1.2% of Novanta shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Kyocera and Novanta”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kyocera	$13.23 billion	1.40	$159.04 million	$0.22	59.64
Novanta	$960.31 million	3.95	$64.09 million	$1.47	71.73

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

Summary

Novanta beats Kyocera on 9 of the 13 factors compared between the two stocks.

About Kyocera

Kyocera Corporation develops, produces, and distributes products based on fine ceramic technologies in Japan, rest of Asia, Europe, the United States, and internationally. It operates through Core Components Business, Electronic Components Business, and Solutions Business segments. The Core Components Business segment offers components, such as fine ceramic components for semiconductor processing equipment, automotive camera modules, and ceramic packages, as well as organic packages and boards to protect electronic components and ICs to industrial machinery, automotive-related, and the information and communication-related markets; optical components, and jewelry and applied ceramic related products; and medical devices comprising prosthetic joints and dental implants. The Electronic Components Business segment provides various electronic components and devices, including capacitors, crystal devices, connectors, and power semiconductor devices for diverse fields comprising information and communications, industrial equipment, automotive-related, and consumer markets, as well as sensors and control components. The Solutions Business segment offers cutting tools, as well as pneumatic and power tools for automotive-related and general industrial, and construction markets; printers for offices; and communication terminals, such as mobile phones, as well as information systems and telecommunication services. This segment also provides MFPs, commercial inkjet printers, communication modules, displays, and printing devices, as well as information systems and telecommunication, smart energy-related products and services, and solution services, such as document management system. The company was formerly known as Kyoto Ceramic Kabushiki Kaisha and changed its name to Kyocera Corporation in 1982. Kyocera Corporation was incorporated in 1946 and is headquartered in Kyoto, Japan.

About Novanta

Novanta, Inc. engages in the provision of core technology solutions to healthcare and advanced industrial original equipment manufacturers. It operates through the following segments: Photonics, Vision, and Precision Motion. The Photonics segment designs, manufactures, and markets photonics-based solutions, including laser scanning and laser beam delivery, CO2 laser, continuous wave and ultrafast laser, and optical light engine products. The Vision segment offers a range of medical grade technologies, including medical insufflators, pumps and related disposables, surgical displays and operating room integration technologies, optical data collection and machine vision technologies, radio frequency identification technologies, thermal printers, spectrometry technologies, and embedded touch screen solutions. The Precision Motion segment includes optical encoders, precision motor and motion control technology, air bearing spindles, and precision machined components to customers. The company was founded in 1968 and is headquartered in Bedford, MA.