Financial Comparison: SMC (OTCMKTS:SMCAY) vs. Daktronics (NASDAQ:DAKT)

Daktronics (NASDAQ:DAKT) and SMC (OTCMKTS:SMCAY) are both technology companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, profitability, dividends and risk.

Volatility and Risk

Daktronics has a beta of 1.68, meaning that its stock price is 68% more volatile than the S&P 500. Comparatively, SMC has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500.

Insider & Institutional Ownership

61.7% of Daktronics shares are owned by institutional investors. Comparatively, 1.0% of SMC shares are owned by institutional investors. 4.6% of Daktronics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Daktronics and SMC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Daktronics	5.66%	18.05%	9.68%
SMC	21.94%	9.40%	8.52%

Analyst Ratings

This is a summary of current ratings for Daktronics and SMC, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Daktronics	0	2	2	0	2.50
SMC	0	1	1	1	3.00

Daktronics currently has a consensus price target of $31.00, suggesting a potential upside of 60.21%. Given Daktronics’ higher possible upside, equities research analysts plainly believe Daktronics is more favorable than SMC.

Earnings and Valuation

This table compares Daktronics and SMC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Daktronics	$838.71 million	1.11	$45.38 million	$0.98	19.74
SMC	$5.60 billion	4.93	$1.10 billion	$1.03	20.96

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

Summary

SMC beats Daktronics on 8 of the 15 factors compared between the two stocks.

About Daktronics

Daktronics, Inc. designs, manufactures, and sells electronic scoreboards, programmable display systems and large screen video displays for sporting, commercial, and transportation applications in the United States and internationally. It operates through Commercial, Live Events, High School Park and Recreation, Transportation, and International segments. The company also offers video display and walls; scoreboards and timing systems; LED message displays and sings; intelligent transportation systems dynamic message signs; mass transit display; sound systems; and digital billboards and street furniture, and digit and price displays. In addition, it provides indoor dynamic messaging systems and liquid crystal display signs; and software and controllers, which includes Venus, a control suite software to control the creation of messages and graphic sequences for uploading to displays. The company sells its products through direct sales and resellers. Daktronics, Inc. was founded in 1968 and is headquartered in Brookings, South Dakota.

About SMC

SMC Corporation manufactures, processes, and sells automatic control equipment, sintered filters, and various types of filtration equipment worldwide. The company offers air management system, directional control valves, air cylinders, rotatory actuators/air grippers, electric actuators/cylinders, fitting and tubing, and modular F.R.L./pressure control equipment, as well as vacuum, air preparation, and lubrication equipment. It also provides flow control equipment, speed controllers, silencers/exhaust/blow guns/pressure gauges, switches/sensors/controllers, static neutralization equipment, and industrial device communication equipment/wireless system. In addition, the company offers process valves, chemical liquid valves/fittings and needle valves/tubing, process pumps, temperature control equipment, and process gas equipment, as well as high vacuum equipment, industrial filters/sintered metal elements, and pneumatic instrumentation and hydraulic equipment. The company was formerly known as Shoketsu Kinzoku Kogyo Co., Ltd. and changed its name to SMC Corporation in April 1986. SMC Corporation was incorporated in 1959 and is headquartered in Tokyo, Japan.