Emerson Electric (NYSE: EMR) and GrafTech International (NYSE:GTI) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, valuation, profitability, analyst recommendations, dividends, earnings and institutional ownership.
Emerson Electric pays an annual dividend of $1.94 per share and has a dividend yield of 2.7%. GrafTech International does not pay a dividend. Emerson Electric pays out 76.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Emerson Electric has raised its dividend for 61 consecutive years.
Valuation and Earnings
This table compares Emerson Electric and GrafTech International’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Emerson Electric||$15.26 billion||2.94||$1.52 billion||$2.54||27.85|
Emerson Electric has higher revenue and earnings than GrafTech International. GrafTech International is trading at a lower price-to-earnings ratio than Emerson Electric, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
70.0% of Emerson Electric shares are owned by institutional investors. 0.8% of Emerson Electric shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This is a summary of current ratings and price targets for Emerson Electric and GrafTech International, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Emerson Electric presently has a consensus price target of $69.90, indicating a potential downside of 1.19%. Given Emerson Electric’s higher probable upside, research analysts clearly believe Emerson Electric is more favorable than GrafTech International.
This table compares Emerson Electric and GrafTech International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Emerson Electric beats GrafTech International on 12 of the 13 factors compared between the two stocks.
Emerson Electric Company Profile
Emerson Electric Co. is a diversified global manufacturing company, which provides solutions to customers by bringing technology and engineering together in the industrial, commercial and consumer markets around the world. The Company operates through four segments based on the nature of the products and services rendered: Process Management, Industrial Automation, Climate Technologies and Commercial & Residential Solutions. The Company’s principal production operations are electronics assembly, metal stamping, forming, casting, machining, welding, plating, heat treating, painting and assembly. In addition, the Company uses specialized production operations, including automatic and semiautomatic testing, automated material handling and storage, ferrous and nonferrous machining, and special furnaces for heat treating and foundry applications. The Company provides measurement, control and diagnostic technologies for automated industrial processes.
GrafTech International Company Profile
GrafTech International Ltd. (GTI) is a manufacturer of graphite electrodes, products essential to the production of electric arc furnace (EAF) steel and other ferrous and nonferrous metals. The Company produces needle coke products, which are the primary raw material needed in the manufacture of graphite electrodes. The Company manufactures carbon, graphite and semi-graphite refractory products, which protect the walls of blast furnaces and submerged arc furnaces. The Company’s operating segments include: Industrial Materials, which include graphite electrodes, refractory products and needle coke products, and Engineered Solutions, which includes advanced graphite materials, advanced composite materials, advanced electronics technologies and advanced materials. The Company has seven product categories: graphite electrodes, refractory products, needle coke products, advanced graphite materials, advanced composite materials, advanced electronics technologies and advanced materials.
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