Proto Labs (NYSE:PRLB – Get Free Report) and Graham (NYSE:GHM – Get Free Report) are both industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
84.5% of Proto Labs shares are held by institutional investors. Comparatively, 69.5% of Graham shares are held by institutional investors. 1.3% of Proto Labs shares are held by company insiders. Comparatively, 2.4% of Graham shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Proto Labs and Graham’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Proto Labs | 5.44% | 4.80% | 4.22% |
| Graham | 4.53% | 11.09% | 5.17% |
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Proto Labs | $533.13 million | 4.37 | $21.24 million | $1.25 | 77.86 |
| Graham | $245.29 million | 4.17 | $12.50 million | $1.04 | 83.83 |
Proto Labs has higher revenue and earnings than Graham. Proto Labs is trading at a lower price-to-earnings ratio than Graham, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Proto Labs has a beta of 1.42, indicating that its stock price is 42% more volatile than the S&P 500. Comparatively, Graham has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Proto Labs and Graham, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Proto Labs | 0 | 0 | 3 | 1 | 3.25 |
| Graham | 0 | 3 | 2 | 0 | 2.40 |
Proto Labs currently has a consensus price target of $89.00, indicating a potential downside of 8.55%. Graham has a consensus price target of $132.50, indicating a potential upside of 51.97%. Given Graham’s higher possible upside, analysts plainly believe Graham is more favorable than Proto Labs.
Summary
Proto Labs beats Graham on 10 of the 15 factors compared between the two stocks.
About Proto Labs
Proto Labs, Inc., together with its subsidiaries, operates as a digital manufacturer of custom parts in the United States and Europe. The company offers injection molding; computer numerical control machining; three-dimensional printing; and sheet metal fabrication products. It serves developers and engineers, who use 3D computer-aided design software to design products across a range of end-markets. Proto Labs, Inc. was incorporated in 1999 and is headquartered in Maple Plain, Minnesota.
About Graham
Graham Corporation, together with its subsidiaries, designs and manufactures fluid, power, heat transfer, and vacuum equipment for chemical and petrochemical processing, defense, space, petroleum refining, cryogenic, energy, and other industries. It offers power plant systems, including ejectors and surface condensers; torpedo ejection, propulsion, and power systems, such as turbines, alternators, regulators, pumps, and blowers; and thermal management systems comprising pumps, blowers, and drive electronics for defense sector. The company also provides rocket propulsion systems consisting of turbopumps and fuel pumps; cooling systems, which include pumps, compressors, fans, and blowers; and life support systems that comprise fans, pumps, and blowers for space industry. In addition, it offers heat transfer and vacuum systems, including ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles; power generation systems, such as turbines, generators, compressors, and pumps; and thermal management systems comprising pumps, blowers, and electronics for energy sector. Further, the company offers heat transfer and vacuum systems consisting of ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles for chemical and petrochemical processing industry. The company also services and sells spare parts for its equipment. It sells its products directly in the United States, the Middle East, Canada, Asia, South America, and internationally. Graham Corporation was founded in 1936 and is headquartered in Batavia, New York.
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