Sono-Tek (NASDAQ:SOTK – Get Free Report) and Stratasys (NASDAQ:SSYS – Get Free Report) are both small-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.
Profitability
This table compares Sono-Tek and Stratasys’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sono-Tek | 9.32% | 9.95% | 7.81% |
| Stratasys | -21.05% | -1.77% | -1.38% |
Risk & Volatility
Sono-Tek has a beta of 0.07, meaning that its share price is 93% less volatile than the S&P 500. Comparatively, Stratasys has a beta of 1.99, meaning that its share price is 99% more volatile than the S&P 500.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Sono-Tek and Stratasys, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sono-Tek | 0 | 1 | 2 | 0 | 2.67 |
| Stratasys | 1 | 1 | 4 | 0 | 2.50 |
Sono-Tek presently has a consensus target price of $7.75, suggesting a potential upside of 43.52%. Stratasys has a consensus target price of $12.33, suggesting a potential upside of 72.49%. Given Stratasys’ higher probable upside, analysts clearly believe Stratasys is more favorable than Sono-Tek.
Institutional & Insider Ownership
47.9% of Sono-Tek shares are held by institutional investors. Comparatively, 75.8% of Stratasys shares are held by institutional investors. 5.6% of Sono-Tek shares are held by insiders. Comparatively, 4.3% of Stratasys shares are held by 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.
Earnings and Valuation
This table compares Sono-Tek and Stratasys”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sono-Tek | $21.51 million | 3.95 | $1.81 million | $0.12 | 45.00 |
| Stratasys | $547.27 million | 1.15 | -$104.29 million | ($1.34) | -5.34 |
Sono-Tek has higher earnings, but lower revenue than Stratasys. Stratasys is trading at a lower price-to-earnings ratio than Sono-Tek, indicating that it is currently the more affordable of the two stocks.
Summary
Sono-Tek beats Stratasys on 9 of the 14 factors compared between the two stocks.
About Sono-Tek
Sono-Tek Corporation designs and manufactures ultrasonic coating systems for applying on parts and components for the microelectronics/electronics, alternative energy, medical, industrial, and research and development/other markets worldwide. The company also designs and manufactures custom-engineered ultrasonic coating systems; and provides nozzles and generators for manufacturers' equipment. Its products include integrated multi-axis coating systems, integrated coating systems, fluxing systems, OEM systems, and other related systems. In addition, the company provides surface coating solutions and application consulting services. It markets and distributes its products through direct sales personnel, select independent distributors, and sales representatives. The company was incorporated in 1975 and is based in Milton, New York.
About Stratasys
Stratasys Ltd. provides connected polymer-based 3D printing solutions. It offers range of 3D printing systems, which includes polyjet printer, Fused Deposition Modeling (FDM) printers, stereolithography printing systems, origin P3 printers, and selective absorption fusion printer for additive manufacturing, and tooling and rapid prototyping for various vertical markets, such as automotive, aerospace, consumer products and healthcare. The company provides consumable materials, including 3D printing materials comprising FDM, polyjet, and stereolithography materials for manufacturing applications, such as jigs and fixtures, investment casting, and injection mold or composite tooling applications; and other material. In addition, it offers software and services, which includes cloud, desktop and mobile technologies comprising GrabCAD, an additive manufacturing platform to manage production-scale operations; and GrabCAD Print, job programming software enables the unique features of 3D printing technologies, such as creating lightweight, structurally sound infills for FDM, and multi-material and color and material management for polyjet. The company also provides GrabCAD Shop including scheduling, remote monitoring, and analytics; GrabCAD Connect provides two-way SDK integration for third-party software applications; and GrabCAD Community, an online community of professional engineers, designers, manufacturers and students who share their practices through tutorials, discussion forums, design/print challenges, and 3D content. Further, it offers GrabCAD Shop, which simplifies 3D printing shop workflow; GrabCAD Streamline Software Development Kit (SDK) to support enterprise goals such as system connectivity, compliance, and workflow automation; and Grab CAD Software Partner program for independent software vendors. The company sells its products through a network of resellers and independent sales agents worldwide. Stratasys Ltd. is headquartered in Eden Prairie, Minnesota.
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