Tennant (NYSE: TNC) and Amtech Systems (NASDAQ:ASYS) are both small-cap industrial products companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitabiliy, analyst recommendations, institutional ownership and dividends.
Profitability
This table compares Tennant and Amtech Systems’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Tennant | 2.32% | 15.39% | 7.19% |
| Amtech Systems | -2.16% | -4.59% | -2.40% |
Valuation & Earnings
This table compares Tennant and Amtech Systems’ revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Tennant | $873.73 million | 1.35 | $69.63 million | $1.12 | 59.15 |
| Amtech Systems | $137.83 million | 0.86 | $744,000.00 | ($0.22) | -40.77 |
Tennant has higher revenue and earnings than Amtech Systems. Amtech Systems is trading at a lower price-to-earnings ratio than Tennant, indicating that it is currently the more affordable of the two stocks.
Dividends
Tennant pays an annual dividend of $0.84 per share and has a dividend yield of 1.3%. Amtech Systems does not pay a dividend. Tennant pays out 75.0% of its earnings in the form of a dividend. Amtech Systems has increased its dividend for 45 consecutive years.
Risk & Volatility
Tennant has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Amtech Systems has a beta of 2.05, suggesting that its stock price is 105% more volatile than the S&P 500.
Institutional and Insider Ownership
89.2% of Tennant shares are owned by institutional investors. Comparatively, 52.7% of Amtech Systems shares are owned by institutional investors. 5.7% of Tennant shares are owned by company insiders. Comparatively, 34.6% of Amtech Systems shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Tennant and Amtech Systems, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Tennant | 0 | 2 | 0 | 0 | 2.00 |
| Amtech Systems | 0 | 0 | 2 | 0 | 3.00 |
Tennant presently has a consensus price target of $65.00, suggesting a potential downside of 1.89%. Amtech Systems has a consensus price target of $10.00, suggesting a potential upside of 11.48%. Given Amtech Systems’ stronger consensus rating and higher probable upside, analysts plainly believe Amtech Systems is more favorable than Tennant.
Summary
Tennant beats Amtech Systems on 9 of the 16 factors compared between the two stocks.
Tennant Company Profile
Tennant Company is engaged in designing, manufacturing and marketing of cleaning solutions. The Company’s segments are Americas; Europe, Middle East, Africa, and Asia Pacific. The Company offers a range of products, including floor maintenance and outdoor cleaning equipment, detergent-free and other sustainable cleaning technologies, aftermarket parts and consumables, equipment maintenance and repair service, specialty surface coatings and asset management solutions. Its products are used in various types of environments, including retail establishments, distribution centers, factories and warehouses, public venues such as arenas and stadiums, office buildings, schools and universities, hospitals and clinics, parking lots and streets. The Company markets and sells its products under various brands: Tennant, Nobles, Green Machines, Alfa Uma Empresa Tennant, IRIS, Orbio IPC, IPC Foma, IPC Eagle, IPC Gansow, ICA, Vaclensa, Portotecnica, Sirio and Soteco, Ready System, Euromop, and Pulex.
Amtech Systems Company Profile
Amtech Systems, Inc. is engaged in the manufacture of capital equipment, including thermal processing, silicon wafer handling automation and related consumables used in fabricating solar cells, Light Emitting Diode (LED) and semiconductor devices. The Company operates through three business segments: solar, semiconductor and polishing. The solar segment supplies thermal processing systems, including diffusion; plasma-enhanced chemical vapor deposition (PECVD); atomic layer deposition (ALD), and related automation, parts and services to the solar/photovoltaic industry. The semiconductor segment supplies thermal processing equipment, including solder reflow equipment and related controls for use by the semiconductor manufacturers and in electronics assembly for automotive and other industries. The polishing supplies segment produces consumables and machinery for lapping (fine abrading) and polishing of materials, such as sapphire substrates and optical components.
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