Critical Contrast: Zebra Technologies (NASDAQ:ZBRA) versus CTS (NYSE:CTS)

Zebra Technologies (NASDAQ:ZBRA) and CTS (NYSE:CTS) are both technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, valuation, dividends, institutional ownership, risk, earnings and analyst recommendations.

Risk & Volatility

Zebra Technologies has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500. Comparatively, CTS has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.

Insider and Institutional Ownership

91.0% of Zebra Technologies shares are owned by institutional investors. Comparatively, 96.9% of CTS shares are owned by institutional investors. 0.9% of Zebra Technologies shares are owned by insiders. Comparatively, 2.4% of CTS shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Zebra Technologies and CTS”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zebra Technologies	$5.40 billion	3.27	$419.00 million	$10.93	33.86
CTS	$541.32 million	3.15	$65.32 million	$2.38	25.08

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

Profitability

This table compares Zebra Technologies and CTS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zebra Technologies	9.22%	22.29%	9.46%
CTS	12.37%	13.48%	9.62%

Analyst Recommendations

This is a summary of current ratings for Zebra Technologies and CTS, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zebra Technologies	0	3	9	1	2.85
CTS	0	2	2	0	2.50

Zebra Technologies presently has a consensus target price of $383.08, indicating a potential upside of 3.52%. CTS has a consensus target price of $73.50, indicating a potential upside of 23.12%. Given CTS’s higher possible upside, analysts plainly believe CTS is more favorable than Zebra Technologies.

Summary

Zebra Technologies beats CTS on 10 of the 15 factors compared between the two stocks.

About Zebra Technologies

Zebra Technologies Corporation, together with its subsidiaries, provides enterprise asset intelligence solutions in the automatic identification and data capture solutions industry worldwide. It operates in two segments, Asset Intelligence & Tracking, and Enterprise Visibility & Mobility. The company designs, manufactures, and sells printers that produce labels, wristbands, tickets, receipts, and plastic cards; dye-sublimination thermal card printers that produce images, which are used for personal identification, access control, and financial transactions; radio frequency identification device (RFID) printers that encode data into passive RFID transponders; accessories and options for printers, including carrying cases, vehicle mounts, and battery chargers; stock and customized thermal labels, receipts, ribbons, plastic cards, and RFID tags for printers; and temperature-monitoring labels primarily used in vaccine distribution. It also provides various maintenance, technical support, repair, and managed and professional services; fixed readers, RFID enabled mobile computers, and RFID sleds; tags, sensors, exciters, middleware software, and application software; and physical inventory management solutions, and rugged and enterprise-grade mobile computing products and accessories, as well as real-time location systems and services. In addition, the company offers barcode scanners and imagers, RFID readers, industrial machine vision cameras, and fixed industrial scanners; workforce management, workflow execution and task management, and prescriptive analytics, as well as communications and collaboration solutions; and cloud-based software subscriptions, retail, and robotics automation solutions. The company serves retail and e-commerce, manufacturing, transportation and logistics, healthcare, public sector, and other industries through direct sales force, and network of channel partners. The company was founded in 1969 and is headquartered in Lincolnshire, Illinois.

About CTS

CTS Corporation manufactures and sells sensors, actuators, and connectivity components in North America, Europe, and Asia. The company provides encoders, rotary position sensors, slide potentiometers, industrial and commercial rotary potentiometers. It also provides non-contacting, and contacting pedals; and eBrake pedals. In addition, the company offers flow meters, hydrophones, non-destructive testing, sonar, ultrasonic imaging, piezoelectric materials, piezoelectric sense products, and bulk products. Further, it provides eMobility, chassis, current sensors, clutch, brake, position sensors, stroke sensor, seating, speed, throttle, transmission, turbo, temperature sensors, and technical related products. Additionally, the company offers DIP, rotary selector, tactile, rotary DIP, and toggle switches, as well as provides transducer related products. Furthermore, it provides EMI, RFI, and RFI products; specialty and resistors; and frequency control products. The company sells and markets its products through its sales engineers, independent manufacturer representatives, and distributors. CTS Corporation was founded in 1896 and is based in Lisle, Illinois.