Reviewing Cognex Corporation (CGNX) & Perceptron (PRCP)

Cognex Corporation (NASDAQ: CGNX) and Perceptron (NASDAQ:PRCP) are both computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, institutional ownership, risk, dividends, analyst recommendations, profitability and earnings.

Dividends

Cognex Corporation pays an annual dividend of $0.34 per share and has a dividend yield of 0.3%. Perceptron does not pay a dividend. Cognex Corporation pays out 15.6% of its earnings in the form of a dividend.

Insider & Institutional Ownership

87.3% of Cognex Corporation shares are owned by institutional investors. Comparatively, 62.8% of Perceptron shares are owned by institutional investors. 5.6% of Cognex Corporation shares are owned by company insiders. Comparatively, 12.0% of Perceptron shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Cognex Corporation and Perceptron’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Cognex Corporation $585.12 million 17.50 $207.39 million $2.18 54.26
Perceptron $77.95 million 0.94 $5.79 million ($0.01) -773.00

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

Analyst Ratings

This is a summary of current recommendations for Cognex Corporation and Perceptron, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cognex Corporation 0 5 5 0 2.50
Perceptron 0 0 1 0 3.00

Cognex Corporation presently has a consensus target price of $77.71, suggesting a potential downside of 34.30%. Perceptron has a consensus target price of $9.00, suggesting a potential upside of 16.43%. Given Perceptron’s stronger consensus rating and higher probable upside, analysts clearly believe Perceptron is more favorable than Cognex Corporation.

Profitability

This table compares Cognex Corporation and Perceptron’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cognex Corporation 33.10% 19.51% 17.95%
Perceptron -0.22% 1.00% 0.58%

Volatility & Risk

Cognex Corporation has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, Perceptron has a beta of 0.5, meaning that its share price is 50% less volatile than the S&P 500.

Summary

Cognex Corporation beats Perceptron on 11 of the 15 factors compared between the two stocks.

Cognex Corporation Company Profile

Cognex Corporation (Cognex) is a provider of machine vision products that capture and analyze visual information in order to automate tasks, primarily in manufacturing processes, where vision is required. The Company operates through the machine vision technology segment. The Company’s machine vision products are used to automate the manufacture and tracking of discrete items, such as mobile phones, aspirin bottles and automobile tires, by locating, identifying, inspecting and measuring them during the manufacturing or distribution process. The Company’s products include vision software, vision systems, vision sensors and identification (ID) products. Its products range from vision sensors that are integrated, to personal computer (PC)-based systems for users. Its products also have a range of physical forms, depending upon the user’s need. Cognex sells its products through a direct sales force, as well as through a global network of integration and distribution partners.

Perceptron Company Profile

Perceptron, Inc. develops, produces and sells a range of automated industrial metrology products and solutions to manufacturing organizations for dimensional gauging, dimensional inspection and three-dimensional (3D) scanning. The Company’s products include 3D machine vision solutions, robot guidance, coordinate measuring machines (CMMs), laser scanning and advanced analysis software. The Company’s products are categorized as In-Line, Near-Line and Off-Line Measurement Solutions (Measurement Solutions); 3D Scanning Solutions, and Value Added Services. Its In-Line and Near-Line measurement solutions include AutoGauge, AutoFit, AutoScan, AutoGuide and Helix. Its Off-Line measurement solutions include Coord3 and TouchDMIS. Its 3D Scanning Solutions include ScanWorks, ScanR and WheelWorks. Its Value Added Services include training, field service, calibration, launch support services, maintenance agreements and repairs. The Company operates in the Americas, Europe and Asia.

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