Napco Security Technologies (NASDAQ:NSSC) and Lumentum (NASDAQ:LITE) are both industrial products companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, dividends, earnings, valuation and risk.
Institutional and Insider Ownership
48.2% of Napco Security Technologies shares are held by institutional investors. Comparatively, 89.8% of Lumentum shares are held by institutional investors. 35.7% of Napco Security Technologies shares are held by company insiders. Comparatively, 0.3% of Lumentum shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Risk & Volatility
Napco Security Technologies has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500. Comparatively, Lumentum has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Napco Security Technologies and Lumentum, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Napco Security Technologies | 0 | 0 | 5 | 0 | 3.00 |
Lumentum | 0 | 1 | 17 | 0 | 2.94 |
Napco Security Technologies currently has a consensus price target of $34.00, indicating a potential upside of 2.60%. Lumentum has a consensus price target of $113.50, indicating a potential upside of 27.69%. Given Lumentum's higher possible upside, analysts plainly believe Lumentum is more favorable than Napco Security Technologies.
Valuation & Earnings
This table compares Napco Security Technologies and Lumentum's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Napco Security Technologies | $101.36 million | 6.00 | $8.52 million | $0.56 | 59.18 |
Lumentum | $1.68 billion | 4.01 | $135.50 million | $4.48 | 19.84 |
Lumentum has higher revenue and earnings than Napco Security Technologies. Lumentum is trading at a lower price-to-earnings ratio than Napco Security Technologies, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Napco Security Technologies and Lumentum's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Napco Security Technologies | 7.74% | 11.96% | 9.12% |
Lumentum | 9.22% | 21.41% | 11.35% |
Summary
Lumentum beats Napco Security Technologies on 9 of the 14 factors compared between the two stocks.