Methode Electronics (NYSE:MEI – Get Free Report) and Evolv Technologies (NASDAQ:EVLV – Get Free Report) are both small-cap technology companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.
Volatility and Risk
Methode Electronics has a beta of 1.54, suggesting that its stock price is 54% more volatile than the S&P 500. Comparatively, Evolv Technologies has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500.
Earnings and Valuation
This table compares Methode Electronics and Evolv Technologies”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Methode Electronics | $1.02 billion | 0.50 | -$35.70 million | ($1.04) | -13.78 |
| Evolv Technologies | $145.90 million | 5.78 | -$33.14 million | ($0.03) | -155.17 |
Evolv Technologies has lower revenue, but higher earnings than Methode Electronics. Evolv Technologies is trading at a lower price-to-earnings ratio than Methode Electronics, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Methode Electronics and Evolv Technologies, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Methode Electronics | 1 | 3 | 2 | 0 | 2.17 |
| Evolv Technologies | 1 | 1 | 4 | 0 | 2.50 |
Methode Electronics presently has a consensus price target of $22.00, suggesting a potential upside of 53.46%. Evolv Technologies has a consensus price target of $9.81, suggesting a potential upside of 110.79%. Given Evolv Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe Evolv Technologies is more favorable than Methode Electronics.
Insider and Institutional Ownership
95.5% of Methode Electronics shares are held by institutional investors. Comparatively, 66.7% of Evolv Technologies shares are held by institutional investors. 1.9% of Methode Electronics shares are held by insiders. Comparatively, 5.2% of Evolv Technologies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Methode Electronics and Evolv Technologies’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Methode Electronics | -3.52% | -5.63% | -2.94% |
| Evolv Technologies | -3.05% | -4.53% | -1.72% |
Summary
Evolv Technologies beats Methode Electronics on 11 of the 14 factors compared between the two stocks.
About Methode Electronics
Methode Electronics, Inc. designs, engineers, and produces mechatronic products worldwide. It operates through four segments: Automotive, Industrial, Interface, and Medical. The Automotive segment supplies electronic and electro-mechanical devices, and related products to automobile original equipment manufacturers directly or through their tiered suppliers. Its products include integrated center consoles, hidden and ergonomic switches, transmission lead-frames, complex insert molded solutions, LED-based lighting solutions, and sensors, which incorporate magneto-elastic sensing, eddy current, or other sensing technologies that monitor the operation or status of a component or system. The Industrial segment manufactures external lighting solutions comprising driving, work, and signal lights; industrial safety radio remote controls; braided flexible cables; current-carrying laminated and powder-coated busbars; high-voltage high current connector and contracts; custom power-product assemblies, such as PowerRail solution; and high-current low-voltage flexible power cabling systems that are used in aerospace, cloud computing, commercial vehicles, construction equipment, industrial, military, power conversion, and transportation markets and applications. The Interface segment provides various copper-based transceivers and related accessories for the cloud computing hardware equipment and telecommunications broadband equipment markets; user interface solutions for the appliance, commercial food service, and point-of-sale equipment markets; and fluid-level sensors for the marine/recreational vehicle and sump pump markets. The Medical segment offers Dabir Surfaces, a surface support technology aimed at pressure injury prevention for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. Methode Electronics, Inc. was incorporated in 1946 and is headquartered in Chicago, Illinois.
About Evolv Technologies
Evolv Technologies Holdings, Inc. provides artificial intelligence (AI)-based weapons detection for security screening in the United States and internationally. Its products include Evolv Express, a touchless security screening system designed to detect firearms, improvised explosive devices, and tactical knives; and Evolv Insights that provides self-serve access, insights regarding visitor flow and arrival curves, location specific performance, system detection performance, and alarm statistics. The company was founded in 2013 and is headquartered in Waltham, Massachusetts.
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