Novanta (NOVT) Stock Analysis & Winston Score

Novanta Inc., together with its subsidiaries, designs, manufactures, markets, and sells photonics, vision, and precision motion components and sub-systems to original equipment manufacturers in the medical and industrial markets worldwide. The company's Photonics segment offers photonics-based solutions, including laser scanning and beam delivery, CO2 laser, solid state laser, ultrafast laser, and optical light engine products serving photonics-based applications for industrial processing, metro

Winston Score History

Politician Trades

4 trades / 12mo

3 Congressional buys and 1 sell on NOVT in the last 12 months.

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+10.4% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

-11.9% YoY

YoY Growth Rate

Earnings declining

Insider Activity

0.8%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$389M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

Novanta is a rare growth stock that's already generating positive cash flow while growing at 10%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

41.8%

Healthy — 41.8% gross margin

Operating Margin

11.7%

Modest — 11.7% operating margin

ROCE

1.9%

Weak — 1.9% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+5.6%

Slow sales growth (5.6% YoY)

EPS YoY

-28.6%

Earnings shrinking (-28.6% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

0/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

154%

Turns 154% of profit into real cash

FCF Margin

6.7%

Modest free cash flow (6.7%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

0.19

Conservative — low debt load (0.19)

Interest Cover

6.61x

Adequate interest coverage (6.6x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

104.7x

no trend

Expensive — P/E 104.7

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+59.5

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (104.7 → 45.2)

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Dividends

Not applicable for this business.

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