EnPro Industries (NYSE: NPO) and Key Technology (NASDAQ:KTEC) are both small-cap industrial products companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, dividends, risk, profitabiliy, analyst recommendations and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings and price targets for EnPro Industries and Key Technology, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
EnPro Industries 0 0 2 0 3.00
Key Technology 0 0 0 0 N/A

EnPro Industries presently has a consensus target price of $85.00, indicating a potential upside of 17.26%. Given EnPro Industries’ higher probable upside, analysts plainly believe EnPro Industries is more favorable than Key Technology.

Profitability

This table compares EnPro Industries and Key Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
EnPro Industries 1.56% 8.71% 2.06%
Key Technology 2.58% 5.27% 3.31%

Insider and Institutional Ownership

94.8% of EnPro Industries shares are held by institutional investors. Comparatively, 44.9% of Key Technology shares are held by institutional investors. 2.6% of EnPro Industries shares are held by company insiders. Comparatively, 29.4% of Key Technology shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

EnPro Industries pays an annual dividend of $0.88 per share and has a dividend yield of 1.2%. Key Technology does not pay a dividend. EnPro Industries pays out 103.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares EnPro Industries and Key Technology’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
EnPro Industries $1.18 billion 1.31 $162.20 million $0.85 85.28
Key Technology $129.89 million 0.70 $10.10 million $0.52 26.92

EnPro Industries has higher revenue and earnings than Key Technology. Key Technology is trading at a lower price-to-earnings ratio than EnPro Industries, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

EnPro Industries has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Key Technology has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Summary

EnPro Industries beats Key Technology on 11 of the 15 factors compared between the two stocks.

EnPro Industries Company Profile

EnPro Industries, Inc. is engaged in the designing, developing, manufacturing and marketing engineered industrial products. It operates through three segments. The Sealing Products segment includes three operating divisions: Garlock, which designs, manufactures and sells sealing products; Technetics, which designs, manufactures and sells metal seals and elastomeric seals, among others, and Stemco LP (Stemco), which designs, manufactures and sells heavy-duty truck wheel-end components and systems. The Engineered Products segment includes two industrial products businesses: GGB, which designs, manufactures and sells self-lubricating, non-rolling, metal polymer and engineered plastics, among others, and Compressor Products International, which designs, manufactures, sells and services components. The Power Systems segment includes Fairbanks Morse business, which designs, manufactures, sells and services heavy-duty, medium-speed diesel, natural gas and dual fuel reciprocating engines.

Key Technology Company Profile

Key Technology, Inc. is a supplier of process automation solutions to the food processing industry and other industries, such as tobacco and pharmaceuticals. The Company designs, manufactures, sells and services automation equipment that processes product streams of discrete pieces. These systems integrate electro-optical automated inspection and digital sorting systems with other processing systems that include specialized conveying and preparation equipment. The Company provides parts and service for each of its product lines to customers around the world. Its automated inspection systems are used in various applications to detect and remove defects and foreign material from the product stream. It offers conveying and processing equipment, which are utilized throughout various industries to move and process product within a production plant. Its Integrated Solutions Group (ISG) provides integrated whole-line solutions. It has an installed base of inspection and processing systems.

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