Powell Industries (NASDAQ: POWL) and Regal Beloit (NYSE:RBC) are both industrial products companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, valuation, profitability, institutional ownership, risk and earnings.
Insider and Institutional Ownership
65.2% of Powell Industries shares are owned by institutional investors. Comparatively, 96.7% of Regal Beloit shares are owned by institutional investors. 24.0% of Powell Industries shares are owned by company insiders. Comparatively, 2.2% of Regal Beloit shares are owned by company 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 table compares Powell Industries and Regal Beloit’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
Powell Industries has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, Regal Beloit has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500.
This is a breakdown of current ratings for Powell Industries and Regal Beloit, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Regal Beloit has a consensus target price of $86.18, indicating a potential upside of 15.37%. Given Regal Beloit’s higher probable upside, analysts clearly believe Regal Beloit is more favorable than Powell Industries.
Powell Industries pays an annual dividend of $1.04 per share and has a dividend yield of 3.6%. Regal Beloit pays an annual dividend of $1.04 per share and has a dividend yield of 1.4%. Powell Industries pays out -80.6% of its earnings in the form of a dividend. Regal Beloit pays out 21.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Powell Industries has raised its dividend for 8 consecutive years. Powell Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares Powell Industries and Regal Beloit’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Powell Industries||$395.91 million||0.83||-$9.48 million||($1.29)||-22.16|
|Regal Beloit||$3.36 billion||0.99||$213.00 million||$4.74||15.76|
Regal Beloit has higher revenue and earnings than Powell Industries. Powell Industries is trading at a lower price-to-earnings ratio than Regal Beloit, indicating that it is currently the more affordable of the two stocks.
Regal Beloit beats Powell Industries on 11 of the 15 factors compared between the two stocks.
About Powell Industries
Powell Industries, Inc. develops design, manufactures and services custom-engineered equipment and systems for the distribution, control and monitoring of electrical energy designed to distribute, control and monitor the flow of electrical energy, and provide protection to motors, transformers and other electrically powered equipment. The Company’s principal products include integrated power control room substations (PCRs), custom-engineered modules, electrical houses (E-Houses), traditional and arc-resistant distribution switchgear and control gear, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers and bus duct systems. These products are designed for application voltages ranging from 480 volts to 38,000 volts, and are used in oil and gas refining, offshore oil and gas production, petrochemical, pipeline, terminal, mining and metals, light rail traction power, electric utility, pulp and paper, and other heavy industrial markets.
About Regal Beloit
Regal Beloit Corporation is a manufacturer of electric motors, electrical motion controls, power generation and power transmission products. The Company operates through three segments: the Commercial and Industrial Systems segment, with its principal line of business in medium and large electric motors, power generation products, high-performance drives and controls and capacitors; the Climate Solutions segment, with its principal line of business in small motors, controls and air moving products, and the Power Transmission Solutions segment, with its principal line of business in power transmission gearing, hydraulic pump drives, open gearing and specialty mechanical products which control motion and torque. It sells its products directly to original equipment manufacturers (OEMs), distributors and end users. It operates distribution facilities in Plainfield, Indiana; McAllen, Texas; LaVergne, Tennessee, and Florence, Kentucky.
Receive News & Ratings for Powell Industries Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Powell Industries and related companies with MarketBeat.com's FREE daily email newsletter.