IPG Photonics (NASDAQ:IPGP) and Fabrinet (NYSE:FN) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, profitability, institutional ownership, analyst recommendations, valuation, dividends and risk.
Profitability
This table compares IPG Photonics and Fabrinet's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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IPG Photonics | 9.04% | 7.76% | 6.85% |
Fabrinet | 7.18% | 13.37% | 9.41% |
Valuation & Earnings
This table compares IPG Photonics and Fabrinet's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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IPG Photonics | $1.31 billion | 9.72 | $180.23 million | $4.36 | 54.75 |
Fabrinet | $1.64 billion | 2.01 | $113.48 million | $3.14 | 28.48 |
IPG Photonics has higher earnings, but lower revenue than Fabrinet. Fabrinet is trading at a lower price-to-earnings ratio than IPG Photonics, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
IPG Photonics has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500. Comparatively, Fabrinet has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of recent ratings and price targets for IPG Photonics and Fabrinet, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
IPG Photonics | 0 | 4 | 5 | 0 | 2.56 |
Fabrinet | 0 | 3 | 5 | 0 | 2.63 |
IPG Photonics currently has a consensus price target of $230.9444, suggesting a potential downside of 3.25%. Fabrinet has a consensus price target of $72.00, suggesting a potential downside of 19.49%. Given IPG Photonics' higher possible upside, equities analysts plainly believe IPG Photonics is more favorable than Fabrinet.
Insider & Institutional Ownership
63.4% of IPG Photonics shares are held by institutional investors. Comparatively, 94.5% of Fabrinet shares are held by institutional investors. 34.0% of IPG Photonics shares are held by company insiders. Comparatively, 0.7% of Fabrinet shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Summary
IPG Photonics beats Fabrinet on 8 of the 13 factors compared between the two stocks.