Head-To-Head Review: Kimball Electronics (NASDAQ:KE) vs. IPG Photonics (NASDAQ:IPGP)

IPG Photonics (NASDAQ:IPGP) and Kimball Electronics (NASDAQ:KE) are both technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Risk and Volatility

IPG Photonics has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, Kimball Electronics has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500.

Insider & Institutional Ownership

93.8% of IPG Photonics shares are held by institutional investors. Comparatively, 76.0% of Kimball Electronics shares are held by institutional investors. 37.5% of IPG Photonics shares are held by insiders. Comparatively, 2.8% of Kimball Electronics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares IPG Photonics and Kimball Electronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IPG Photonics	2.58%	3.39%	2.98%
Kimball Electronics	1.95%	4.42%	2.35%

Valuation and Earnings

This table compares IPG Photonics and Kimball Electronics”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IPG Photonics	$1.00 billion	3.56	$31.10 million	$0.65	129.14
Kimball Electronics	$1.43 billion	0.44	$16.98 million	$1.04	25.03

IPG Photonics has higher earnings, but lower revenue than Kimball Electronics. Kimball Electronics is trading at a lower price-to-earnings ratio than IPG Photonics, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and target prices for IPG Photonics and Kimball Electronics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IPG Photonics	1	2	5	0	2.50
Kimball Electronics	0	2	2	1	2.80

IPG Photonics currently has a consensus price target of $142.60, indicating a potential upside of 69.88%. Kimball Electronics has a consensus price target of $32.00, indicating a potential upside of 22.94%. Given IPG Photonics’ higher probable upside, analysts plainly believe IPG Photonics is more favorable than Kimball Electronics.

Summary

IPG Photonics beats Kimball Electronics on 9 of the 15 factors compared between the two stocks.

About IPG Photonics

IPG Photonics Corporation develops, manufactures, and sells various high-performance fiber lasers, fiber amplifiers, and diode lasers used in various applications primarily in materials processing worldwide. Its laser products include hybrid fiber-solid state lasers with green and ultraviolet wavelengths; fiber pigtailed packaged diodes and fiber coupled direct diode laser systems; high-energy pulsed lasers, multi-wavelength and tunable lasers, and single-polarization and single-frequency lasers; and high-power optical fiber delivery cables, fiber couplers, beam switches, chillers, scanners, and other accessories. The company also offers integrated laser systems; LightWELD, a handheld laser welding system; 2D compact flat sheet cutter systems and multi-axis systems for fine welding, cutting, and drilling; welding seam stepper and picker, a fiber laser welding tool; high precision laser systems; specialized fiber laser systems for material processing applications; robotic and multi-axis workstations for welding, cutting and cladding, flatbed cutting systems, and diode markers; and laser and non-laser robotic welding and automation solutions. It serves materials processing, communications, medical procedures, and advanced applications and communications markets. The company markets its products to original equipment manufacturers, system integrators, and end users through direct sales force, as well as through agreements with independent sales representatives and distributors. IPG Photonics Corporation was founded in 1990 and is headquartered in Marlborough, Massachusetts.

About Kimball Electronics

Kimball Electronics, Inc. engages in the provision of electronics manufacturing, engineering, and supply chain support services to customers in the automotive, medical, and industrial end markets. The Company also offers contract manufacturing services, including engineering and supply chain support for the production of electronic assemblies and other products, including non-electronic components, medical devices, medical disposables, and precision molded plastics, as well as automation, test, and inspection equipment primarily used in automotive, medical, and industrial applications. In addition, it is also involved in the production and testing of printed circuit board assemblies, as well as clean room assembly, cold chain, and product sterilization management activities. Further, the company offers design services and support, supply chain services and support, rapid prototyping and new product introduction support, product design and process validation and qualification, industrialization and automation of manufacturing processes, reliability testing, aftermarket services, drug delivery devices and solutions with and without electronics, and product life cycle management services, as well as and assembly of medical, automotive, and industrial products. It operates in the United States, China, Mexico, Poland, Romania, Thailand, India, Japan, Vietnam, and internationally. Kimball Electronics, Inc. was founded in 1961 and is headquartered in Jasper, Indiana.