Comparing Proto Labs (NYSE:PRLB) & Mayville Engineering (NYSE:MEC)

Mayville Engineering (NYSE:MEC) and Proto Labs (NYSE:PRLB) are both small-cap industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.

Valuation & Earnings

This table compares Mayville Engineering and Proto Labs”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mayville Engineering	$546.49 million	0.89	-$8.11 million	($0.84)	-22.77
Proto Labs	$560.54 million	3.48	$21.24 million	$1.25	65.29

Proto Labs has higher revenue and earnings than Mayville Engineering. Mayville Engineering is trading at a lower price-to-earnings ratio than Proto Labs, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Mayville Engineering has a beta of 1.26, meaning that its stock price is 26% more volatile than the S&P 500. Comparatively, Proto Labs has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500.

Institutional and Insider Ownership

45.4% of Mayville Engineering shares are held by institutional investors. Comparatively, 84.5% of Proto Labs shares are held by institutional investors. 5.6% of Mayville Engineering shares are held by company insiders. Comparatively, 1.3% of Proto Labs shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Mayville Engineering and Proto Labs, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mayville Engineering	1	1	4	0	2.50
Proto Labs	0	0	3	1	3.25

Mayville Engineering currently has a consensus price target of $35.75, suggesting a potential upside of 86.88%. Proto Labs has a consensus price target of $89.00, suggesting a potential upside of 9.06%. Given Mayville Engineering’s higher possible upside, research analysts plainly believe Mayville Engineering is more favorable than Proto Labs.

Profitability

This table compares Mayville Engineering and Proto Labs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mayville Engineering	-2.95%	-6.63%	-2.99%
Proto Labs	5.44%	4.80%	4.22%

Summary

Proto Labs beats Mayville Engineering on 12 of the 15 factors compared between the two stocks.

About Mayville Engineering

Mayville Engineering Company, Inc., together with its subsidiaries, engages in the production, design, prototyping and tooling, fabrication, aluminum extrusion, coating, and assembling of aftermarket components in the United States. It also supplies engineered components to original equipment manufacturers. The company serves heavy and medium duty commercial vehicles, construction and access equipment, powersports, agriculture, military, and other end markets. Mayville Engineering Company, Inc. was founded in 1945 and is headquartered in Milwaukee, Wisconsin.

About Proto Labs

Proto Labs, Inc., together with its subsidiaries, operates as a digital manufacturer of custom parts in the United States and Europe. The company offers injection molding; computer numerical control machining; three-dimensional printing; and sheet metal fabrication products. It serves developers and engineers, who use 3D computer-aided design software to design products across a range of end-markets. Proto Labs, Inc. was incorporated in 1999 and is headquartered in Maple Plain, Minnesota.