Allied Motion Technologies (NASDAQ: AMOT) and MKS Instruments (NASDAQ:MKSI) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Profitability

This table compares Allied Motion Technologies and MKS Instruments’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allied Motion Technologies 3.41% 10.65% 4.45%
MKS Instruments 15.47% 19.47% 11.16%

Insider and Institutional Ownership

39.1% of Allied Motion Technologies shares are held by institutional investors. Comparatively, 98.3% of MKS Instruments shares are held by institutional investors. 30.8% of Allied Motion Technologies shares are held by insiders. Comparatively, 1.7% of MKS Instruments shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for Allied Motion Technologies and MKS Instruments, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allied Motion Technologies 0 0 0 0 N/A
MKS Instruments 0 0 4 0 3.00

MKS Instruments has a consensus target price of $85.25, suggesting a potential upside of 7.30%. Given MKS Instruments’ higher probable upside, analysts clearly believe MKS Instruments is more favorable than Allied Motion Technologies.

Dividends

Allied Motion Technologies pays an annual dividend of $0.10 per share and has a dividend yield of 0.4%. MKS Instruments pays an annual dividend of $0.70 per share and has a dividend yield of 0.9%. Allied Motion Technologies pays out 11.4% of its earnings in the form of a dividend. MKS Instruments pays out 14.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Earnings & Valuation

This table compares Allied Motion Technologies and MKS Instruments’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Allied Motion Technologies $238.07 million 1.00 $26.26 million $0.88 28.56
MKS Instruments $1.70 billion 2.53 $405.48 million $4.80 16.55

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

Risk and Volatility

Allied Motion Technologies has a beta of 1.88, indicating that its share price is 88% more volatile than the S&P 500. Comparatively, MKS Instruments has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.

Summary

MKS Instruments beats Allied Motion Technologies on 11 of the 15 factors compared between the two stocks.

About Allied Motion Technologies

Allied Motion Technologies Inc. designs, manufactures and sells precision and specialty motion control components and systems used in a range of industries. The Company serves various markets, including vehicle, medical, aerospace and defense, electronics and industrial. It focuses on motion control applications. It is engaged in developing electro-magnetic, mechanical and electronic motion technology. It operates in the design and manufacture of motion control products, marketed to original equipment manufacturers and end users segment. Its products are used in the handling, inspection, and testing of components and final products, such as printers, tunable lasers and spectrum analyzers for the fiber optic industry, and test and processing equipment for the semiconductor manufacturing industry. Its products are used in a range of medical, industrial and commercial aviation applications, such as dialysis equipment, industrial ink jet printers and cash dispensers.

About MKS Instruments

MKS Instruments, Inc. is a global provider of instruments, subsystems and process control solutions that measures, controls, powers, delivers, monitors and analyzes critical parameters of advanced manufacturing processes. The Company operates through two segments, including the Vacuum & Analysis segment and the Light & Motion segment. The Vacuum & Analysis segment provides a range of instruments, components, subsystems and software, which are derived from its core competencies in pressure measurement and control, flow measurement and control, gas and vapor delivery, gas composition analysis, residual gas analysis, leak detection, control and information technology, ozone generation and delivery, radio frequency (RF) and direct current (DC) power, reactive gas generation and vacuum technology. The Light & Motion segment provides a range of instruments, components and subsystems, which are derived from its core competencies in lasers, photonics and optics.

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