Critical Review: Powerfleet (NASDAQ:AIOT) & Napco Security Technologies (NASDAQ:NSSC)

Napco Security Technologies (NASDAQ:NSSC) and Powerfleet (NASDAQ:AIOT) are both small-cap industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Napco Security Technologies	$186.53 million	4.64	$49.82 million	$1.30	18.29
Powerfleet	$133.74 million	5.10	-$3.50 million	N/A	N/A

Napco Security Technologies has higher revenue and earnings than Powerfleet.

Analyst Recommendations

This is a summary of current ratings and target prices for Napco Security Technologies and Powerfleet, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Napco Security Technologies	0	4	3	0	2.43
Powerfleet	0	0	5	0	3.00

Napco Security Technologies currently has a consensus target price of $35.50, suggesting a potential upside of 49.29%. Powerfleet has a consensus target price of $11.25, suggesting a potential upside of 118.45%. Given Powerfleet’s stronger consensus rating and higher probable upside, analysts plainly believe Powerfleet is more favorable than Napco Security Technologies.

Profitability

This table compares Napco Security Technologies and Powerfleet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Napco Security Technologies	25.94%	27.65%	23.74%
Powerfleet	N/A	N/A	N/A

Volatility and Risk

Napco Security Technologies has a beta of 1.51, indicating that its stock price is 51% more volatile than the S&P 500. Comparatively, Powerfleet has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500.

Insider and Institutional Ownership

85.1% of Napco Security Technologies shares are owned by institutional investors. Comparatively, 73.4% of Powerfleet shares are owned by institutional investors. 5.2% of Napco Security Technologies shares are owned by company insiders. Comparatively, 7.8% of Powerfleet shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Napco Security Technologies beats Powerfleet on 7 of the 12 factors compared between the two stocks.

About Napco Security Technologies

Napco Security Technologies, Inc. develops, manufactures, and sells electronic security systems for commercial, residential, institutional, industrial, and governmental applications in the United States and internationally. Its access control systems include various types of identification readers, control panels, PC-based computers, and electronically activated door-locking devices; intrusion and fire alarm systems, consists of various detectors, a control panel, a digital keypad and signaling equipment; and door locking devices comprise microprocessor-based electronic door locks with push button, card readers and bio-metric operation, door alarms, mechanical door locks, and simple dead bolt locks. The company’s alarm systems include automatic communicators, cellular communication devices, control panels, combination control panels/digital communicators and digital keypad systems, fire alarm control panels, and area detectors; and video surveillance systems comprise video cameras, control panels, video monitors, or PCs. It also buys and resells various identification readers, video cameras, PC-based computers, and various peripheral equipment for access control and video surveillance systems; offers school security products; and markets peripheral and related equipment manufactured by other companies. The company markets and sells its products to independent distributors, dealers, and installers of security equipment. Napco Security Technologies, Inc. was founded in 1969 and is headquartered in Amityville, New York.

About Powerfleet

PowerFleet, Inc. engages in the provision of fleet management solutions for logistics, industrial, and vehicles. It offers wireless Internet of Things and machine to machine solutions for securing, controlling, tracking, and managing enterprise assets such as industrial trucks, tractor trailers, containers, cargo, and vehicle and truck fleets. It operates through the following geographical segments: United States, Israel, and Other. The company was founded in 1993 and is headquartered in Woodcliff Lake, NJ.