Critical Survey: Novanta (NASDAQ:NOVT) vs. Inno (NASDAQ:INHD)

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

Valuation and Earnings

This table compares Novanta and Inno”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Novanta	$980.60 million	5.43	$53.83 million	$1.56	90.26
Inno	$5.54 million	1.66	-$7.08 million	($5.90)	-0.62

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

Volatility and Risk

Novanta has a beta of 1.72, suggesting that its share price is 72% more volatile than the S&P 500. Comparatively, Inno has a beta of -23.22, suggesting that its share price is 2,422% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Novanta	6.00%	10.83%	7.53%
Inno	-72.63%	-9.47%	-9.36%

Analyst Ratings

This is a breakdown of recent ratings and target prices for Novanta and Inno, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Novanta	0	2	1	0	2.33
Inno	1	0	0	0	1.00

Novanta currently has a consensus price target of $194.00, indicating a potential upside of 37.78%. Given Novanta’s stronger consensus rating and higher possible upside, analysts clearly believe Novanta is more favorable than Inno.

Insider & Institutional Ownership

98.3% of Novanta shares are held by institutional investors. Comparatively, 0.2% of Inno shares are held by institutional investors. 1.2% of Novanta shares are held by company insiders. Comparatively, 0.1% of Inno shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Novanta beats Inno on 14 of the 14 factors compared between the two stocks.

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.

About Inno

Inno Holdings Inc. manufactures and sells cold-formed-steel members, castor cubes, mobile factories, and prefabricated homes in the United States. The company provides cold-formed steel framing and a mobile factory for off-site equipment rental, sales, service, and support. It serves in residential, commercial, industrial, and infrastructure projects. Inno Holdings Inc. was founded in 2019 and is headquartered in Brookshire, Texas.