Critical Survey: Benchmark Electronics (NYSE:BHE) and LightPath Technologies (NASDAQ:LPTH)

LightPath Technologies (NASDAQ:LPTH) and Benchmark Electronics (NYSE:BHE) are both technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Profitability

This table compares LightPath Technologies and Benchmark Electronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
LightPath Technologies	-28.65%	-7.02%	-4.13%
Benchmark Electronics	1.90%	7.71%	3.94%

Risk & Volatility

LightPath Technologies has a beta of 1.53, suggesting that its stock price is 53% more volatile than the S&P 500. Comparatively, Benchmark Electronics has a beta of 1.4, suggesting that its stock price is 40% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for LightPath Technologies and Benchmark Electronics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LightPath Technologies	1	0	4	1	2.83
Benchmark Electronics	0	2	2	0	2.50

LightPath Technologies presently has a consensus target price of $13.70, suggesting a potential upside of 75.42%. Benchmark Electronics has a consensus target price of $88.50, suggesting a potential upside of 24.35%. Given LightPath Technologies’ stronger consensus rating and higher possible upside, research analysts clearly believe LightPath Technologies is more favorable than Benchmark Electronics.

Institutional & Insider Ownership

56.3% of LightPath Technologies shares are owned by institutional investors. Comparatively, 92.3% of Benchmark Electronics shares are owned by institutional investors. 10.9% of LightPath Technologies shares are owned by company insiders. Comparatively, 1.1% of Benchmark Electronics shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares LightPath Technologies and Benchmark Electronics”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LightPath Technologies	$71.72 million	7.63	-$20.55 million	($0.40)	-19.52
Benchmark Electronics	$2.66 billion	0.96	$24.85 million	$1.55	45.92

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

Summary

Benchmark Electronics beats LightPath Technologies on 8 of the 15 factors compared between the two stocks.

About LightPath Technologies

LightPath Technologies, Inc. designs, develops, manufactures, and distributes optical components and assemblies. The company offers precision molded glass aspheric optics, molded and diamond-turned infrared aspheric lenses, and other optical components used to produce products that manipulate light; and infrared products, including catalog and custom infrared optics. Its products are used in defense products, medical devices, laser aided industrial tools, automotive safety applications, barcode scanners, optical data storage, hybrid fiber coax datacom, telecommunications, machine vision and sensors, and other sectors. The company sells its products directly to customers in Europe and Asia. LightPath Technologies, Inc. was founded in 1985 and is headquartered in Orlando, Florida.

About Benchmark Electronics

Benchmark Electronics, Inc., together with its subsidiaries, offers product design, engineering services, technology solutions, and manufacturing services in the Americas, Asia, and Europe. The company provides engineering services and technology solutions, including new product design, prototype, testing, and related engineering services; and custom testing and technology solutions, as well as automation equipment design and build services. It also offers electronics manufacturing and testing services, such as printed circuit board assembly and test solutions, assembly of subsystems, circuitry and functionality testing of printed assemblies, environmental and stress testing, and component reliability testing; component engineering services; manufacturing defect analysis, in-circuit testing, functional testing, and life cycle testing services, as well as environmental stress tests of assemblies of boards or systems; and failure analysis. In addition, the company provides precision machining and electromechanical assembly services; and subsystem and system integration services, including assembly, configuration, and testing for various industries. Further, it provides value-added support systems; supply chain management solutions; direct order fulfillment; and aftermarket non-warranty services, including repair, replacement, refurbishment, remanufacturing, exchange, systems upgrade, and spare parts manufacturing throughout a product’s life cycle. The company serves original equipment manufacturers in the aerospace and defense, medical technologies, complex industrials, semiconductor capital equipment, telecommunications, and advanced computing industries. It markets its services and solutions primarily through a direct sales force. The company was formerly known as Electronics, Inc. Benchmark Electronics, Inc. was founded in 1979 and is headquartered in Tempe, Arizona.