Novanta (NASDAQ:NOVT) and Sunrun (NASDAQ:RUN) Financial Analysis

Novanta (NASDAQ:NOVT – Get Rating) and Sunrun (NASDAQ:RUN – Get Rating) are both mid-cap computer…


Novanta (NASDAQ:NOVTGet Rating) and Sunrun (NASDAQ:RUNGet Rating) are both mid-cap computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Institutional and Insider Ownership

96.9% of Novanta shares are held by institutional investors. Comparatively, 98.0% of Sunrun shares are held by institutional investors. 3.4% of Novanta shares are held by insiders. Comparatively, 4.4% of Sunrun shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

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

Net Margins Return on Equity Return on Assets
Novanta 7.12% 18.86% 9.01%
Sunrun -4.93% -0.70% -0.31%

Risk and Volatility

Novanta has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, Sunrun has a beta of 2.1, meaning that its share price is 110% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Novanta and Sunrun, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Novanta 0 1 0 0 2.00
Sunrun 0 0 16 0 3.00

Sunrun has a consensus price target of $60.79, indicating a potential upside of 199.14%. Given Sunrun’s stronger consensus rating and higher probable upside, analysts plainly believe Sunrun is more favorable than Novanta.

Valuation and Earnings

This table compares Novanta and Sunrun’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Novanta $706.79 million 6.42 $50.33 million $1.41 90.26
Sunrun $1.61 billion 2.63 -$79.42 million ($0.40) -50.80

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

Novanta Company Profile (Get Rating)

Novanta Inc., together with its subsidiaries, designs, manufactures, markets, and sells photonics, vision, and precision motion components and sub-systems to original equipment manufacturers in the medical and industrial markets worldwide. Its Photonics segment offers photonics-based solutions, including laser scanning and beam delivery, CO2 laser, solid state laser, ultrafast laser, and optical light engine products for photonics-based applications, such as industrial processing, metrology, medical and life science imaging, DNA sequencing, and medical laser procedures. The company’s Vision segment provides a range of medical grade technologies, including medical insufflators, pumps, and related disposables; visualization solutions; wireless, recorder, and video integration technologies for operating room integrations; optical data collection and machine vision technologies; radio frequency identification technologies; thermal chart recorders; spectrometry technologies; and embedded touch screen solutions. Its Precision Motion segment offers optical and inductive encoders, precision motors, motion control sub-assemblies, servo drives, air bearings, and air bearing spindles. The company sells its products through its direct sales force, resellers, distributors, and system integrators under the Cambridge Technology, Synrad, Laser Quantum, ARGES, WOM, NDS, NDSsi, Med X Change, Reach Technology, JADAK, ThingMagic, Photo Research, Celera Motion, MicroE, Zettlex, Applimotion, Ingenia, and Westwind brands. The company was formerly known as GSI Group, Inc. and changed its name to Novanta Inc. in May 2016. Novanta Inc. was founded in 1968 and is headquartered in Bedford, Massachusetts.

Sunrun Company Profile (Get Rating)

Sunrun Inc. engages in the design, development, installation, sale, ownership, and maintenance of residential solar energy systems in the United States. It also sells solar energy systems and products, such as panels and racking; and solar leads generated to customers. In addition, the company offers battery storage along with solar energy systems. Its primary customers are residential homeowners. The company markets and sells its products through direct-to-consumer approach across online, retail, mass media, digital media, canvassing, field marketing, and referral channels, as well as its partner network. Sunrun Inc. was founded in 2007 and is headquartered in San Francisco, California.



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