Analyzing Benchmark Electronics (BHE) and Plexus Corp. (PLXS)

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Benchmark Electronics (NYSE: BHE) and Plexus Corp. (NASDAQ:PLXS) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitabiliy and dividends.

Institutional & Insider Ownership

97.4% of Benchmark Electronics shares are owned by institutional investors. Comparatively, 93.6% of Plexus Corp. shares are owned by institutional investors. 0.9% of Benchmark Electronics shares are owned by insiders. Comparatively, 4.3% of Plexus Corp. shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Benchmark Electronics and Plexus Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Benchmark Electronics 2.69% 5.38% 3.68%
Plexus Corp. 4.01% 11.10% 5.79%

Volatility and Risk

Benchmark Electronics has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, Plexus Corp. has a beta of 0.91, suggesting that its share price is 9% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Benchmark Electronics and Plexus Corp., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Benchmark Electronics 1 2 1 0 2.00
Plexus Corp. 0 4 1 0 2.20

Benchmark Electronics presently has a consensus target price of $27.67, indicating a potential downside of 18.63%. Plexus Corp. has a consensus target price of $58.75, indicating a potential upside of 10.72%. Given Plexus Corp.’s stronger consensus rating and higher probable upside, analysts clearly believe Plexus Corp. is more favorable than Benchmark Electronics.

Earnings and Valuation

This table compares Benchmark Electronics and Plexus Corp.’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Benchmark Electronics $2.33 billion 0.73 $134.66 million $1.26 26.98
Plexus Corp. $2.56 billion 0.70 $178.41 million $2.98 17.81

Plexus Corp. has higher revenue and earnings than Benchmark Electronics. Plexus Corp. is trading at a lower price-to-earnings ratio than Benchmark Electronics, indicating that it is currently the more affordable of the two stocks.

Summary

Plexus Corp. beats Benchmark Electronics on 10 of the 13 factors compared between the two stocks.

About Benchmark Electronics

Benchmark Electronics, Inc. is a provider of electronic manufacturing services. The Company operates through three segments: the Americas, Asia and Europe. It provides services to original equipment manufacturers of industrial control equipment, including equipment for the aerospace and defense industry; telecommunication equipment; computers and related products for business enterprises; medical devices, and testing and instrumentation products. It offers integrated design and manufacturing services. Its operations consist of over three principal areas: manufacturing and assembly operations, including printed circuit boards assemblies and subsystem assembly, box build and systems integration; precision technology manufacturing, which include precision machining, metal joining, assembly and functional testing, and specialized engineering services, and specialized engineering services, such as product design, printed circuit board layout, prototyping, automation and test development.

About Plexus Corp.

Plexus Corp. (Plexus) and its subsidiaries are engaged in the electronic manufacturing services (EMS) industry. The Company delivers end-to-end solutions for customers in the Americas (AMER), Europe, Middle East, and Africa (EMEA) and Asia-Pacific (APAC) regions. The Company’s segments are AMER, APAC and EMEA. The Company’s customer-focused solutions model integrates product conceptualization, design, commercialization, manufacturing, fulfillment and sustaining solutions. The Company delivers solutions to its customers through its product realization value stream. The Company provides a range of aftermarket services, including complex repair, refurbishment and product support for products it manufactures. The Company provides customer service to approximately 140 branded product companies in the healthcare/life sciences, industrial/commercial, networking/communications and defense/security/aerospace market sectors.

 

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