Contrasting NVE Corporation (NVEC) & Methode Electronics (MEI)
Methode Electronics (NYSE: MEI) and NVE Corporation (NASDAQ:NVEC) are both small-cap computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, risk and dividends.
Volatility and Risk
Methode Electronics has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500. Comparatively, NVE Corporation has a beta of 1.21, indicating that its stock price is 21% more volatile than the S&P 500.
Valuation and Earnings
This table compares Methode Electronics and NVE Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Methode Electronics||$816.50 million||1.75||$149.90 million||$2.48||15.71|
|NVE Corporation||$29.23 million||12.07||$18.97 million||$2.70||27.00|
Methode Electronics has higher revenue and earnings than NVE Corporation. Methode Electronics is trading at a lower price-to-earnings ratio than NVE Corporation, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and recommmendations for Methode Electronics and NVE Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Methode Electronics currently has a consensus target price of $45.50, indicating a potential upside of 16.82%. NVE Corporation has a consensus target price of $79.00, indicating a potential upside of 8.37%. Given Methode Electronics’ stronger consensus rating and higher probable upside, analysts plainly believe Methode Electronics is more favorable than NVE Corporation.
Methode Electronics pays an annual dividend of $0.36 per share and has a dividend yield of 0.9%. NVE Corporation pays an annual dividend of $4.00 per share and has a dividend yield of 5.5%. Methode Electronics pays out 14.5% of its earnings in the form of a dividend. NVE Corporation pays out 148.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Insider and Institutional Ownership
90.2% of Methode Electronics shares are owned by institutional investors. Comparatively, 71.4% of NVE Corporation shares are owned by institutional investors. 4.4% of Methode Electronics shares are owned by insiders. Comparatively, 2.3% of NVE Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
This table compares Methode Electronics and NVE Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Methode Electronics beats NVE Corporation on 10 of the 16 factors compared between the two stocks.
Methode Electronics Company Profile
Methode Electronics, Inc. (Methode) is a manufacturer of component and subsystem devices. The Company designs, manufactures and markets devices employing electrical, radio remote control, electronic, wireless and sensing technologies. The Company operates through segments, including Automotive, Interface, Power Products and Other. The Automotive segment supplies electronic and electro-mechanical devices and related products to automobile original equipment manufacturers (OEMs). The Interface segment provides a range of copper and fiber-optic interface and interface solutions. The Power Products segment manufactures braided flexible cables, current-carrying laminated bus devices, custom power-product assemblies, such as PowerRail solution, high-current low voltage flexible power cabling systems and powder coated bus bars. The Other segment includes medical devices, inverters and battery systems, and insulated gate bipolar transistor solutions.
NVE Corporation Company Profile
NVE Corporation develops and sells devices that use spintronics, a nanotechnology that relies on electron spin to acquire, store and transmit information. The Company manufactures spintronic products, including sensors and couplers that are used to acquire and transmit data. The Company has also licensed its spintronic magnetoresistive random access memory technology (MRAM). Its parts are found in industrial, scientific, and medical applications. The Company’s products include sensors, couplers and MRAM products. Its sensor products detect the strength or gradient of magnetic fields and are used to determine position or speed. Its spintronic couplers combine a GMR sensor element and an IsoLoop integrated microscopic coil. MRAM uses spintronics to store data. It combines the speed of static random-access memory (SRAM), the density of dynamic random-access memory (DRAM) and the nonvolatility of flash memory. Data is stored in the spin of the electrons in thin metal alloy films.
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