Head to Head Analysis: UFP Technologies (NASDAQ:UFPT) and Karat Packaging (NASDAQ:KRT)

UFP Technologies (NASDAQ:UFPT) and Karat Packaging (NASDAQ:KRT) are both small-cap industrials companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, analyst recommendations, risk, profitability and earnings.

Insider & Institutional Ownership

87.3% of UFP Technologies shares are owned by institutional investors. Comparatively, 25.2% of Karat Packaging shares are owned by institutional investors. 4.4% of UFP Technologies shares are owned by insiders. Comparatively, 66.2% of Karat Packaging shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares UFP Technologies and Karat Packaging”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UFP Technologies	$504.42 million	3.46	$58.98 million	$8.63	26.26
Karat Packaging	$422.63 million	1.23	$29.98 million	$1.59	16.26

UFP Technologies has higher revenue and earnings than Karat Packaging. Karat Packaging is trading at a lower price-to-earnings ratio than UFP Technologies, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and price targets for UFP Technologies and Karat Packaging, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UFP Technologies	0	1	1	0	2.50
Karat Packaging	0	3	1	0	2.25

UFP Technologies currently has a consensus target price of $289.00, indicating a potential upside of 27.53%. Karat Packaging has a consensus target price of $31.6667, indicating a potential upside of 22.45%. Given UFP Technologies’ stronger consensus rating and higher possible upside, research analysts plainly believe UFP Technologies is more favorable than Karat Packaging.

Volatility and Risk

UFP Technologies has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500. Comparatively, Karat Packaging has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500.

Profitability

This table compares UFP Technologies and Karat Packaging’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UFP Technologies	11.40%	21.54%	12.00%
Karat Packaging	7.25%	20.26%	10.65%

Summary

UFP Technologies beats Karat Packaging on 12 of the 13 factors compared between the two stocks.

About UFP Technologies

UFP Technologies, Inc. designs and manufactures solutions for medical devices, sterile packaging, and other highly engineered custom products. The company offers protective drapes for robotic surgery, single patient use surfaces, advanced wound care, infection prevention, disposables for surgical and endoscopic procedures, packaging for medical devices, orthopedic implants, biopharma drug manufacturing, and coils for catheters; and molded components for applications in acoustic insulation, interior trim, load floors, sunshades, SUV cargo cover handles, driveshaft damping, engine and manifold covers, quarter panels, and wheel liners. It also provides molded composites for commercial aviation and military gear for use in backpack components, knee and elbow pads, eyewear, and helmets; and reusable cases and custom for applications in military ballistics panels, virtual training systems, drones, communications equipment, and rugged portable computers. In addition, the company provides engineered products and components to customers in the automotive, aerospace and defense, and industrial markets for applications in military uniform and gear components, automotive interior trim, air filtration, and protective cases and inserts. It markets and sells its products through a direct sales force. The company was founded in 1963 and is headquartered in Newburyport, Massachusetts.

About Karat Packaging

Karat Packaging Inc., together with its subsidiaries, engages in the manufacture and distribution of single-use disposable products in plastic, paper, biopolymer-based, and other compostable forms used in various restaurant and foodservice settings. It provides food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and other products under the Karat Earth brand. The company also provides new product development, design, printing, and logistics services. It offers its products to national and regional distributors, restaurant chains, retail establishments, and online customers. The company was founded in 2000 and is based in Chino, California.