{"id":557994,"date":"2026-07-24T21:02:25","date_gmt":"2026-07-24T21:02:25","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/557994\/"},"modified":"2026-07-24T21:02:25","modified_gmt":"2026-07-24T21:02:25","slug":"3-reasons-to-avoid-novt-and-1-stock-to-buy-instead","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/557994\/","title":{"rendered":"3 Reasons to Avoid NOVT and 1 Stock to Buy Instead"},"content":{"rendered":"

\"NOVT<\/a> 3 Reasons to Avoid NOVT and 1 Stock to Buy Instead <\/p>\n

Since January 2026, Novanta has been in a holding pattern, posting a small return of 3.3% while floating around $142. <\/p>\n

Is now the time to buy Novanta, or should you be careful about including it in your portfolio? Get the full breakdown from our expert analysts, it’s free<\/a>. <\/p>\n

Why Is Novanta Not Exciting? <\/p>\n

We’re cautious about Novanta. Here are three reasons we avoid NOVT, plus one stock we’d rather own. <\/p>\n

1. Lackluster Revenue Growth <\/p>\n

We at StockStory place the most emphasis on long-term growth, but within industrials, a stretched historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Novanta’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 6.1% over the last two years was well below its five-year trend. <\/p>\n

\"Novanta<\/a> Novanta Year-On-Year Revenue Growth 2. Projected Revenue Growth Is Slim <\/p>\n

Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite. <\/p>\n

Over the next 12 months, sell-side analysts expect Novanta’s revenue to rise by 6.5%, close to its 10.9% annualized growth for the past five years. This projection doesn’t excite us and indicates its newer products and services will not lead to better top-line performance yet. <\/p>\n

3. Recent EPS Growth Below Our Standards <\/p>\n

While long-term earnings trends give us the big picture, we also track EPS over a shorter period because it can provide insight into an emerging theme or development for the business. <\/p>\n

Novanta’s unimpressive 5.3% annual EPS growth over the last two years aligns with its revenue trend. This tells us it maintained its per-share profitability as it expanded. <\/p>\n

\"Novanta<\/a> Novanta Trailing 12-Month EPS (Non-GAAP) Final Judgment <\/p>\n

Novanta isn’t a terrible business, but it doesn’t pass our bar. That said, the stock currently trades at 38.6\u00d7 forward P\/E (or $142 per share). Investors with a higher risk tolerance might like the company, but we don’t really see a big opportunity at the moment. We’re fairly confident there are better stocks to buy right now. We’d recommend looking at the Amazon <\/a>and<\/a> PayPal of Latin America<\/a>. <\/p>\n

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