Comparing Garrett Motion (OTCMKTS:GTXMQ) & Cepton (NASDAQ:CPTN)

Garrett Motion (OTCMKTS:GTXMQ) and Cepton (NASDAQ:CPTN) are both small-cap auto/tires/trucks companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Insider & Institutional Ownership

12.7% of Garrett Motion shares are held by institutional investors. Comparatively, 6.6% of Cepton shares are held by institutional investors. 0.9% of Garrett Motion shares are held by company insiders. Comparatively, 38.2% of Cepton shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Garrett Motion has a beta of 2.55, suggesting that its share price is 155% more volatile than the S&P 500. Comparatively, Cepton has a beta of -0.03, suggesting that its share price is 103% less volatile than the S&P 500.

Profitability

This table compares Garrett Motion and Cepton’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Garrett Motion	6.65%	-6.89%	6.44%
Cepton	-804.94%	-783.92%	-77.17%

Valuation and Earnings

This table compares Garrett Motion and Cepton’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Garrett Motion	$3.25 billion	0.13	$313.00 million	$3.86	1.43
Cepton	$7.43 million	11.42	$9.38 million	($0.39)	-1.38

Garrett Motion has higher revenue and earnings than Cepton. Cepton is trading at a lower price-to-earnings ratio than Garrett Motion, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Garrett Motion and Cepton, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Garrett Motion	0	0	0	0	N/A
Cepton	1	0	0	0	1.00

Summary

Garrett Motion beats Cepton on 8 of the 10 factors compared between the two stocks.

About Garrett Motion

Garrett Motion, Inc. provides automobile technology. The firm engages in the designing, manufacturing and selling engineered turbocharger, electric-boosting technologies for light and commercial vehicle original equipment manufacturers. It offers light vehicle gasoline, light vehicle diesel and commercial vehicle turbochargers that enhance vehicle performance, fuel economy and drivability. The company was founded on March 14, 2018 and is headquartered in Rolle, Switzerland.

About Cepton

Cepton, Inc. provides lidar-based solutions for automotive, smart cities, smart spaces, and smart industrial applications in the United States, Japan, China, and internationally. The company offers autograde lidar sensors, including Vista-X, a compact lidar solution with a range of up to 200m for long-range applications in ADAS L2+/L3, AV L4/L5, and suitable for smart infrastructure applications; and Nova, an ultra-small form factor lidar solution with a range of up to 30m for near-range applications in ADAS L2+/L3, AV L4/L5, and suitable for smart infrastructure applications. It also provides industrial grade lidar sensors, such as Vista-P, a compact lidar solution with a range of up to 200m for long-range applications in ADAS L2+/L3, AV L4/L5, and smart infrastructure applications; and Sora-P, an ultra-high scan rate, compact, and quasi line-scanning lidar solution that delivers high-fidelity profiling of objects moving at high speeds for free flow tolling and other industrial applications. The company was founded in 2016 and is headquartered in San Jose, California.