Novanta (NASDAQ:NOVT) versus Electra Battery Materials (NASDAQ:ELBM) Critical Survey

Electra Battery Materials (NASDAQ:ELBM) and Novanta (NASDAQ:NOVT) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, analyst recommendations, valuation and risk.

Insider and Institutional Ownership

32.9% of Electra Battery Materials shares are held by institutional investors. Comparatively, 98.4% of Novanta shares are held by institutional investors. 22.7% of Electra Battery Materials shares are held by company insiders. Comparatively, 1.2% of Novanta shares are held by company 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 breakdown of current recommendations and price targets for Electra Battery Materials and Novanta, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Electra Battery Materials	0	0	2	0	3.00
Novanta	0	0	0	0	N/A

Electra Battery Materials presently has a consensus target price of $1.83, indicating a potential upside of 379.63%. Given Electra Battery Materials’ higher possible upside, analysts clearly believe Electra Battery Materials is more favorable than Novanta.

Volatility & Risk

Electra Battery Materials has a beta of 2.56, indicating that its stock price is 156% more volatile than the S&P 500. Comparatively, Novanta has a beta of 1.31, indicating that its stock price is 31% more volatile than the S&P 500.

Profitability

This table compares Electra Battery Materials and Novanta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Electra Battery Materials	N/A	-16.87%	-9.73%
Novanta	7.76%	16.58%	8.60%

Earnings & Valuation

This table compares Electra Battery Materials and Novanta’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Electra Battery Materials	N/A	N/A	-$47.90 million	($0.94)	-0.40
Novanta	$881.66 million	7.54	$72.88 million	$1.93	95.94

Novanta has higher revenue and earnings than Electra Battery Materials. Electra Battery Materials is trading at a lower price-to-earnings ratio than Novanta, indicating that it is currently the more affordable of the two stocks.

Summary

Novanta beats Electra Battery Materials on 8 of the 12 factors compared between the two stocks.

About Electra Battery Materials

Electra Battery Materials Corporation engages in the acquisition and exploration of resource properties in the United States and Canada. It primarily explores for cobalt and silver deposits. The company's flagship project is the Iron Creek cobalt-copper project located in Lemhi County, Idaho. It also operates a cobalt refinery for producing battery materials for the electric vehicle supply chain. The company was formerly known as First Cobalt Corp. and changed its name to Electra Battery Materials Corporation in December 2021. Electra Battery Materials Corporation was incorporated in 2011 and is headquartered in Toronto, Canada.

About Novanta

Novanta Inc., together with its subsidiaries, provides precision medicine and manufacturing, medical solutions, and robotics and automation solutions in the United States and internationally. The company operates through three segments: Precision Medicine and Manufacturing, Medical Solutions, and Robotics and Automation. The Precision Medicine and Manufacturing segment offers photonics-based solutions, including laser scanning, beam delivery, CO2 laser, solid state laser, ultrafast laser, and optical light engine products serving photonics-based applications for industrial processing, metrology, medical and life science imaging, DNA sequencing, and medical laser procedures. The Medical Solutions segment provides a range of medical grade technologies, including medical insufflators, pumps, and related disposables; visualization solutions; wireless technologies, video recorders, and video integration technologies for operating room integrations; optical data collection and machine vision technologies; radio frequency identification technologies; thermal chart recorders; spectrometry technologies; and embedded touch screen solutions. The Robotics and Automation segment offers optical and inductive encoders, precision motors, servo drives and motion control solutions, integrated stepper motors, intelligent robotic end-of-arm technology solutions, air bearings, and air bearing spindles. The company sells its products through its direct sales force and distributors under the Cambridge Technology, Synrad, Laser Quantum, ARGES, WOM, NDS, Med X Change, Reach Technology, JADAK, ThingMagic, Photo Research, General Scanning, ATI Industrial Automation, Celera Motion, IMS, MicroE, Applimotion, Zettlex, Ingenia, and Westwind brands. The company was formerly known as GSI Group, Inc. and changed its name to Novanta Inc. in May 2016. Novanta Inc. was incorporated in 1968 and is headquartered in Bedford, Massachusetts.