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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Novanta Inc. (XNAS:NOVT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NOVT
Name:
Novanta Inc. (XNAS:NOVT)
Sector:
3.57M
Industry:
Scientific & Technical Instruments
CEO:
Mr. Matthijs Glastra
Total Employees:
2,700
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -89.98% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NOVANTA INC.(NOVT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SCIENTIFIC & TECHNICAL INSTRUMENTS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
128.67
One Month Price Target:
$129.53
Six Month Price Target :
$133.82
Likely Price in One Year's Time:
Ticker:
$138.97
Likely Trading Range Today Under (Normal Volatility)
$128.2
Price Upper limit ($) :
$129.37
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$121.72
This week:
$113.13
This month :
$97.6
Other Primary facts
Market Cap:
4.51B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
35.64M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.22%
-13.79%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$160.89
$145.99
$96.45
$111.35
Medium risk (<10%) entry points
Buy Call
Sell Call
$141.14
Buy Put:
Sell Put:
$137.96
$116.16
$119.38
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NOVT
Sharpe Ratio:
2.97%
Comparison:
NOVT, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 118.41% higher than the industry
& ratio is 30.14% higher than the market/S&P 500 average
Average Returns/Yield of
NOVT
Daily returns:
0.09%
Weekly returns:
0.44%
Monthly returns:
1.76%
Yearly returns:
11.06%
Comparison of returns:
Average annual returns/yield (last 3 years) is 91.11% above industry average
Classification:
NOVT, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.29
Statistical test of Returns:
NOVT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.67%
Weekly Volatility:
5.97%
Monthly Volatility:
11.95%
Yearly Volatility:
41.40%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.22%
Volatility in last five trading days has been -91.93% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.40%
Weekly VaR:
-12.07%
Monthly VaR:
-24.15%
How Much Can the price of
NOVT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-20%
Worst case (decline):
-83.65%
This translates to price declining to:
$102.50
This translates to price declining to:
$21.04
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
NOVT is a 70.43% riskier investment compared to the market/S&P 500 & is 46.01% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -3.01% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NOVT
Beta in relation to market/S&P 500--1.19
Expected beta in 1 year's time:
0.711
Expected beta in 3 year's time:
1.005
Unlevered (debt free) Beta:
0.685
Beta in relation to Nasdaq (XNAS):
0.685
Beta in relation to all global stocks::
0.986
Beta Comparison & Analysis
Beta of competitors/peers::
1.506
Beta is -20.86% lower than peers
Average Industry Beta:
1.276
Beta is -6.61% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
10.12%
Sustainable growth rate is -53.59% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.098
Alpha is -1292.40% below industry average alpha yield
Alpha is 626% higher than market/& is unsustainably high
Analysis of Cost of Capital of
NOVT
Equity cost of capital:
0.113
Equity cost of capital is -4.86% below industry mean WACC
Unlevered (without debt) cost of capital:
6.50%
Before-tax cost of debt:
-1.26%
After-tax cost of debt:
-1.00%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
-1.00%
WACC is -32.86% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$21.00
Revenue growth rate per share of (3Y):
8.58
Annual revenue growth rate is -16.05% below industry average
EPS:
$1.62
Expected Annual growth rate of EPS (3Y):
6.72%
Expected future EPS growth rate is 18.44% higher than the Scientific & Technical Instruments industry
Free cash flow (FCF) per share:
$1.66
-
-
Debt per share
$12.95
EBITDA per share
$3.06
Valuation Analysis Today of
NOVT
P/E Ratio:
72.42
P/E Ratio of Competitors/Peers:
1518.77
P/E ratio is -95.23% lower than main peers & is 66.98% higher than the industry
Stock price/value with industry average P/E ratio: $70.26
NOVT is 83.14% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
6.13
Price to sales ratio is 25.81% above the industry mean
P/B (Price to book value ratio):
8.58
Price to free cash flow: 77.45
-
Net income growth rate (3Y):
1.09%
Net income growth rate is -104.00% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
86.32%
Net debt to equity ratio:
70.28%
Debt to assets ratio:
38.27%
Net debt to assets ratio:
31.16%
Debt-to-asset ratio is -19.09% below industry average
Ability to repay debt:
Interest coverage ratio:
-18.18
Interest coverage ratio is -257.78% less than industry average
Looking forward:
Debt growth rate:
147.99%
Annual debt growth is 88% higher than industry average debt growth rate
Debt repayment rate in last quarter: 2.46%
Analysis of Key Statistics
Correlation of price movement with the market:
0.487
Statistical significance of correlation:
NOVT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.619
Stock price is -21.40% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.619
Correlation of price movement with Nasdaq (^IXIC):
-0.034
Covariance of price movement with the market:
-0.053
Kurtosis
5.948
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.312
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NOVT
Gross Profit Margin Ratio:
172%
Operating Profit Margin Ratio:
10.32%
Operating profit margin is -2.01% lower than the industry
Net Profit Margin Ratio:
172%
Effective Tax Rate:
14.32%
Effective tax rate is -64.29% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.82%
Return on equity (ROE) is -43.76% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
4.80%
Return on assets (ROA) is -10.62% lower than the industry
Financial Leverage:
1.6x
Current Ratio:
2.05
Current ratio is -12.97% below industry average
Cash Conversion Cycle (days):
26
Cash conversion cycle is -53.18% below industry average
The remaining useful life of property plant & equipment is: 8.6 years
Stock based compensation to net income ratio:
11.71%
In-depth Efficiency Analysis
Revenue generated per employee:
277.2K
Each employee generates -14% less revenue than industry average revenue per employee
EBITDA generated per employee:
40.4K
Each employee generates -37% less EBITDA than industry average revenue per employee
Profit generated per employee:
21.4K
Each employee generates -38% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
1.3K
Each employee generates -67% less free cash flow than industry average revenue per employee
Assets/Capital per employee
307.7K
Each employee generates -67% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 18.90%
Growth rate in R&D investment/expenditure is 536.71% higher than the industry
Competitors/Peer firms of
NOVT
BLACKLINE, INC (XNAS:BL)
RAPID7, INC. (XNAS:RPD)
AMKOR TECHNOLOGY, INC. (XNAS:AMKR)
AMBARELLA INC (XNAS:AMBA)
LUMINAR TECHNOLOGIES, INC. (XNAS:LAZR)
Braze, Inc. (XNAS:BRZE)
MICROSTRATEGY INCORPORATED (XNAS:MSTR)
NATIONAL INSTRUMENTS CORPORATION (XNAS:NATI)
FRESHWORKS INC. (XNAS:FRSH)
Current Analyst Ratings
Strong buy�0%
Buy�4%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
4/1/22
Revenue:
748.43M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
426.56M
321.86M
74.77M
-
136.85M
-
21.88M
233.50M
-
- 6000.00K
47.59M
109.10M
77.24M
57.84M
67.51M
9.67M
57.84M
Statement of Cash Flow
Date:
Period:
14.04M
Differed Income Tax :
- 5140.00K
Stock Based Compensation :
6.77M
Change in Working Capital :
- 22137.00K
Accounts Receivables:
- 8949.00K
Other Working Capital:
- 2262.00K
Other Non-Cash Items:
- 1014.00K
Net Cash Provided by Operating Activities:
11.35M
Investments in PP&E:
- 6308.00K
Net Acquisitions:
820.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/1/22
2022
Q1
98.81M
-
98.81M
123.76M
139.17M
13.65M
375.38M
136.36M
475.80M
208.46M
-
4.50M
5.68M
830.79M
-
1.21B
72.04M
13.05M
7.70M
7.25M
90.64M
182.98M
461.56M
7.10M
488.50M
-
671.47M
423.86M
75.35M
- 17325.0K
52.81M
April 1, 2022 at 6:00:00 AM
660.06M
534.69M
1.21B
-
474.61M
375.8M
-
- 1333.00K
- 6821.00K
- 11640.00K
-
-
-
- 10389.00K
- 22029.00K
- 1085.00K
- 18588.00K
98.81M
117.39M
11.35M
- 7778.00K
3.57M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NOVT
2023
2024
2025
2026
2027
$139.66
$836.63
$903.62
$975.97
$1,054.11