MeritValue

NOVANTA INC

NOVTdata completeness 100%17 fiscal years on file
The thesis, from the filings

NOVANTA INC earns about 7% on invested capital, below its ~9% cost of capital, but has diluted owners by 3% over 5 years — no moat visible in the numbers. The estimate methods put fair value between $18.09 and $81.91 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$706.8M1$860.9M2$881.7M3$949.2M3$980.6M3
Net income$50.3M4$74.1M5$72.9M6$64.1M6$53.8M6
Operating cash flow$94.6M7$90.8M8$120.1M9$158.5M9$64.1M9
Capital expenditure$20M10$19.6M11$20M12$17.2M12$15.6M12
Free cash flow (derived)$74.6M7$71.1M8$100.1M9$141.4M9$48.4M9
Total debt$434.5M13$435.5M14$354.4M15$416.6M16$250.8M16
Cash & equivalents$117.4M17$100.1M18$105.1M19$114M20$380.9M20
Diluted shares35.8M35.9M36.0M36.1M36.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$358.1
your share of equity
Profit it earned you last year
$14.67
Free cash flow it threw off
$13.2
Debt you’d be carrying
$68.34

10 shares is a claim on $358.1 of net worth that earned you $14.67 and generated $13.2 of cash last year, against $68.34 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
7% avg · 5y
FY21 6%FY22 8%FY23 8%FY24 6%FY25 5%

It earned about 7% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
+3% shares · 5y

Share count is up 3% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has fallen 42% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $18.09 and $81.91 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$81.91
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth10.3%
  • fcfBase$100.1M
DCF · Growth Exit 5Y
$63.93
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth10.3%
  • fcfBase$100.1M
Earnings Power Value
$18.09
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$64.1M
  • growthAssumed0.0%
Graham Number
$34.42
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years10.3%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $63.93
The three cases
Bear0.0%$42.52
Base10.3%$63.93
Bull15.3%$77.46

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 10.3%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000950170-24-021689 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000950170-25-026131 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001193125-26-064230 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000950170-24-021689 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000950170-25-026131 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001193125-26-064230 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000950170-24-021689 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000950170-25-026131 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001193125-26-064230 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000950170-24-021689 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000950170-25-026131 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001193125-26-064230 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000950170-23-005365 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000950170-24-021689 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000950170-25-026131 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001193125-26-064230 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000950170-23-005365 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000950170-24-021689 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000950170-25-026131 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001193125-26-064230 (CashAndCashEquivalentsAtCarryingValue)