Gentex (NASDAQ:GNTX) and Cepton (NASDAQ:CPTN) Critical Contrast

Cepton (NASDAQ:CPTN) and Gentex (NASDAQ:GNTX) are both auto/tires/trucks companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, risk, valuation, dividends and analyst recommendations.

Volatility & Risk

Cepton has a beta of 0.05, indicating that its stock price is 95% less volatile than the S&P 500. Comparatively, Gentex has a beta of 0.97, indicating that its stock price is 3% less volatile than the S&P 500.

Valuation and Earnings

This table compares Cepton and Gentex’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cepton	$13.06 million	3.28	-$48.55 million	($2.56)	-1.05
Gentex	$2.30 billion	3.39	$428.40 million	$1.89	17.84

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

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Cepton and Gentex, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cepton	0	2	0	0	2.00
Gentex	0	3	3	0	2.50

Gentex has a consensus price target of $37.83, indicating a potential upside of 12.23%. Given Gentex’s stronger consensus rating and higher possible upside, analysts plainly believe Gentex is more favorable than Cepton.

Profitability

This table compares Cepton and Gentex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cepton	-300.64%	N/A	-47.27%
Gentex	18.77%	19.19%	16.93%

Institutional & Insider Ownership

68.2% of Cepton shares are held by institutional investors. Comparatively, 86.8% of Gentex shares are held by institutional investors. 36.1% of Cepton shares are held by company insiders. Comparatively, 0.4% of Gentex shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Gentex beats Cepton on 13 of the 14 factors compared between the two stocks.

About Cepton

Cepton, Inc. provides lidar-based solutions for automotive, smart cities, smart spaces, and smart industrial applications in the United States, Japan, China, and internationally. The company offers autograde lidar sensors, including Cepton Ultra, a slimmest lidar with MagnoSteer technology and proprietary ASIC chipset, enabling a combination of 300-meter range at 10% reflectivity and 0.05° resolution; Vista-X, a compact lidar solution with a range of up to 200m for long-range applications in ADAS L2+/L3, AV L4/L5, and suitable for smart infrastructure applications; and Nova, an extremely-small form factor lidar solution with a range of up to 30m for near-range applications in ADAS L2+/L3, AV L4/L5, and suitable for smart infrastructure applications. It also provides industrial grade lidar sensors, such as Vista-P, a compact lidar solution with a range of up to 200m for long-range applications in ADAS L2+/L3, AV L4/L5, and smart infrastructure applications; and Sora-P, an ultra-high scan rate, compact, and quasi line-scanning lidar solution that delivers high-fidelity profiling of objects moving at high speeds for free flow tolling and other industrial applications. The company was founded in 2016 and is headquartered in San Jose, California.

About Gentex

Gentex Corporation designs, develops, manufactures, markets, and supplies digital vision, connected car, dimmable glass, and fire protection products in the United States, Germany, Japan, Mexico, Republic of Korea, and internationally. It operates through Automotive Products and Other segments. The company offers automotive products, including interior and exterior electrochromic automatic-dimming rearview mirrors, automotive electronics, and non-automatic-dimming rearview mirrors for automotive passenger cars, light trucks, pick-up trucks, sport utility vehicles, and vans for original equipment manufacturers, automotive suppliers, and various aftermarket and accessory customers. It also provides variable dimmable windows to aircraft manufacturers and airline operators. In addition, the company offers photoelectric smoke detectors and alarms, electrochemical carbon monoxide alarms and detectors, audible and visual signaling alarms, and bells and speakers used in fire detection systems in office buildings, hotels, and other commercial and residential buildings, as well as researches and develops nanofiber chemical sensing products. It sells its fire protection products directly, as well as through sales managers and manufacturer representative organizations to fire protection and security product distributors, electrical wholesale houses, and original equipment manufacturers of fire protection systems. Gentex Corporation was incorporated in 1974 and is headquartered in Zeeland, Michigan.