Novanta (NOVT) AI Stock Analysis

• Market Cap: $4.63B
• Dividend Yield: N/A
• Average Volume (3M): 364.91K
• Price to Earnings (P/E): 88.4
• Beta (1Y): 1.69
• Revenue Growth: 4.07%
• EPS Growth: -12.34%
• Country: US
• Employees: 3,000
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 0.87
• Shares Outstanding: 35,775,124
• 10 Day Avg. Volume: 346,951
• 30 Day Avg. Volume: 364,912
• PEG Ratio: -6.96
• Price to Book (P/B): 7.37
• Price to Sales (P/S): 5.79
• P/FCF Ratio: 38.85
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 5.31
• Enterprise Value/Gross Profit: 11.85
• Enterprise Value/Ebitda: 29.72
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: $115.00 ▲(4.17% Upside)

Novanta's overall stock score reflects strong financial performance and a positive earnings call, offset by technical indicators suggesting bearish momentum and a high valuation. The company's strategic initiatives and market leadership provide a positive long-term outlook, but current valuation and technical trends pose short-term risks.

Positive Factors

New Product Revenue Growth

Substantial growth in new product revenue indicates strong innovation and market acceptance, enhancing long-term competitive positioning.

Advanced Surgery and Robotics Growth

Growth in Advanced Surgery and Robotics segments suggests strong demand and potential for sustained revenue expansion in high-growth markets.

Strategic Design Wins

Strategic design wins in key areas enhance market position and future revenue streams, reinforcing Novanta's competitive advantage.

Negative Factors

Decline in Precision Medicine Market

Decline in Precision Medicine sales could indicate market challenges or competitive pressures, potentially impacting future growth in this segment.

Impact of Tariffs

Ongoing tariff impacts create cost pressures and uncertainty, potentially affecting profitability and strategic planning in international markets.

Decrease in Operating Cash Flow

Reduced operating cash flow may limit investment capacity and flexibility, posing risks to future growth and financial stability.

Novanta Business Overview & Revenue Model

Company Description

Novanta Inc. (NASDAQ: NOVT) is a leading provider of precision photonics and motion control solutions, primarily serving the medical and industrial sectors. The company specializes in the design and manufacturing of advanced technology components and systems that enable high-performance applications, including laser and imaging systems, motion control, and optical solutions. Novanta's core products include laser systems, optical components, and motion control systems, which are essential in various applications such as medical devices, semiconductor equipment, and industrial automation.

How the Company Makes Money

Novanta generates revenue through the sale of its precision components and systems, focusing on high-margin products that cater to specialized markets. The company's key revenue streams include sales of laser and imaging systems, motion control solutions, and optical products. Additionally, Novanta benefits from recurring revenue through service contracts and maintenance agreements for their systems. Strategic partnerships with leading companies in the medical and industrial sectors enhance its market position, while ongoing investments in research and development allow for innovation and the introduction of new technologies, further contributing to its earnings.

Novanta Financial Statement Overview

Summary

Novanta shows strong revenue growth and operational efficiency with stable margins and a solid balance sheet. However, declining cash flow metrics and slight margin compression suggest areas for improvement.

Income Statement

Novanta's income statement shows strong revenue growth with a 35.9% increase in TTM, indicating robust demand and market presence. The gross profit margin of 44.8% and net profit margin of 6.4% are healthy, though slightly below industry leaders. EBIT and EBITDA margins are solid at 12.6% and 18.6%, respectively, reflecting efficient operations. However, the decline in EBIT and EBITDA margins compared to the previous year suggests rising costs or competitive pressures.

Balance Sheet

The balance sheet is stable with a debt-to-equity ratio of 0.64, indicating moderate leverage. Return on equity is 8.0%, which is decent but shows a decline from previous years, suggesting a need for improved profitability. The equity ratio of 53.2% indicates a strong capital structure, providing a buffer against financial volatility.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by 12.9% in TTM, which could be a concern for future investments. The operating cash flow to net income ratio of 0.72 suggests adequate cash generation relative to earnings, but the decrease from previous periods indicates potential cash flow management issues. The free cash flow to net income ratio remains strong at 0.90, highlighting efficient conversion of earnings to cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	960.31M	949.25M	881.66M	860.90M	706.79M	590.62M
Gross Profit	430.25M	421.55M	399.90M	378.47M	300.33M	244.52M
EBITDA	171.53M	179.86M	169.92M	160.62M	125.47M	97.99M
Net Income	52.82M	64.09M	72.88M	74.05M	50.33M	44.52M
Balance Sheet
Total Assets	1.51B	1.39B	1.23B	1.24B	1.23B	865.18M
Cash, Cash Equivalents and Short-Term Investments	89.22M	113.99M	105.05M	100.11M	117.39M	125.05M
Total Debt	505.28M	471.00M	404.56M	489.38M	493.40M	255.05M
Total Liabilities	704.34M	642.81M	552.60M	663.63M	706.59M	388.37M
Stockholders Equity	801.48M	745.70M	673.46M	577.59M	521.29M	476.81M
Cash Flow
Free Cash Flow	102.61M	141.35M	100.11M	71.14M	72.45M	129.72M
Operating Cash Flow	116.81M	158.51M	120.08M	90.78M	94.63M	140.24M
Investing Cash Flow	-72.78M	-208.19M	-19.89M	-42.54M	-306.70M	-13.16M
Financing Cash Flow	-46.94M	56.94M	-97.85M	-60.15M	204.75M	-84.36M

Novanta Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 110.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NOVT, the sentiment is Negative. The current price of 110.4 is below the 20-day moving average (MA) of 118.45, below the 50-day MA of 112.41, and below the 200-day MA of 123.78, indicating a bearish trend. The MACD of -0.24 indicates Positive momentum. The RSI at 45.65 is Neutral, neither overbought nor oversold. The STOCH value of 15.63 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NOVT.

Novanta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OSIS	78 Outperform	$4.85B	32.53	17.58%	―	9.37%	15.70%
ESE	76 Outperform	$5.71B	49.83	9.01%	0.15%	10.65%	15.22%
PLXS	75 Outperform	$3.95B	23.35	12.44%	―	1.82%	56.52%
VICR	73 Outperform	$3.95B	48.40	13.89%	―	11.55%	1745.46%
NOVT	65 Neutral	$4.63B	88.42	6.84%	―	4.07%	-12.34%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ST	61 Neutral	$4.62B	―	-0.92%	1.53%	-8.07%	63.50%

Novanta Corporate Events

Novanta Inc. Launches $550 Million Equity Offering to Boost Strategic Flexibility

Novanta Inc. announced a public offering of 11 million tangible equity units, totaling $550 million, to enhance its financial flexibility and support strategic initiatives. The proceeds are expected to be used for strengthening the balance sheet, funding potential acquisitions, and repaying debt, which could positively impact Novanta’s operational capabilities and market positioning.

The most recent analyst rating on (NOVT) stock is a Hold with a $148.00 price target. To see the full list of analyst forecasts on Novanta stock, see the NOVT Stock Forecast page.

Novanta Inc. Launches $550 Million Equity Offering to Bolster Financial Flexibility

Novanta Inc. has announced a public offering of 11 million tangible equity units, valued at $550 million, to strengthen its balance sheet and enhance strategic flexibility. The proceeds are expected to fund working capital, potential acquisitions, investments, and other corporate purposes, including the repayment of $317 million in debt, positioning Novanta for future growth and stability.

The most recent analyst rating on (NOVT) stock is a Hold with a $148.00 price target. To see the full list of analyst forecasts on Novanta stock, see the NOVT Stock Forecast page.

Novanta Reports Modest Revenue Growth in Q3 2025

Novanta Inc. is a leading global supplier of core technology solutions, specializing in precision medicine, precision manufacturing, robotics, automation, and advanced surgery for medical and advanced technology equipment manufacturers. In its third-quarter 2025 financial report, Novanta announced a 1.4% increase in GAAP revenue to $247.8 million and a GAAP net income of $10.7 million. The company also reported a GAAP diluted earnings per share of $0.30 and an adjusted EBITDA of $58.1 million. Despite the slight revenue growth, Novanta experienced a decline in GAAP operating income and net income compared to the previous year. The company attributed its revenue growth to acquisition activities and favorable foreign currency exchange rates, although organic revenue growth showed a decline. Novanta’s management highlighted significant growth in its Advanced Surgery business and expressed confidence in achieving financial objectives for the full year, expecting mid to high single-digit organic growth and solid double-digit adjusted EPS growth in the fourth quarter. Looking ahead, Novanta anticipates continued momentum in its business and end markets, driven by new product launches and design wins, projecting mid-single-digit organic revenue growth for the full year 2026.

Novanta’s Earnings Call: Record Revenue and Positive Outlook

Novanta’s recent earnings call painted a picture of overall optimism, underscored by record revenue achievements and strong growth in new product sales. Despite facing challenges such as organic revenue decline and issues within the Precision Medicine segment, the company’s strategic initiatives and market leadership appear to outweigh these negatives. The call conveyed a positive outlook for 2026, driven by strategic growth initiatives.

Novanta Inc. Reports Strong Q3 2025 Financial Results

Novanta Inc. reported its financial results for the third quarter of 2025, showing a 1.4% increase in GAAP revenue to $247.8 million and a GAAP net income of $10.7 million. The company also reported a GAAP diluted earnings per share of $0.30 and an adjusted EBITDA of $58.1 million. The results exceeded expectations due to strong business fundamentals, new product revenues, and significant growth in the Advanced Surgery business, with a book-to-bill ratio of 1.03x and a 17% increase in bookings year-over-year.

The most recent analyst rating on (NOVT) stock is a Hold with a $141.00 price target. To see the full list of analyst forecasts on Novanta stock, see the NOVT Stock Forecast page.

Novanta Board Member Barbara Hulit Resigns

On September 15, 2025, Barbara Hulit announced her resignation from the Board of Directors and several committees of Novanta Inc., effective November 1, 2025. Her resignation was not due to any disagreements with the company’s operations, policies, or practices.

The most recent analyst rating on (NOVT) stock is a Hold with a $123.00 price target. To see the full list of analyst forecasts on Novanta stock, see the NOVT Stock Forecast page.