Douglas Dynamics (NYSE: PLOW) and Komatsu (OTCMKTS:KMTUY) are both auto/tires/trucks companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.
Volatility & Risk
Douglas Dynamics has a beta of 1.2, suggesting that its stock price is 20% more volatile than the S&P 500. Comparatively, Komatsu has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500.
This table compares Douglas Dynamics and Komatsu’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Douglas Dynamics pays an annual dividend of $1.06 per share and has a dividend yield of 2.3%. Komatsu pays an annual dividend of $0.26 per share and has a dividend yield of 0.8%. Douglas Dynamics pays out 77.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Komatsu pays out 13.8% of its earnings in the form of a dividend. Douglas Dynamics has increased its dividend for 5 consecutive years. Douglas Dynamics is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current ratings and recommmendations for Douglas Dynamics and Komatsu, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Douglas Dynamics presently has a consensus price target of $47.00, suggesting a potential upside of 2.06%. Given Douglas Dynamics’ higher possible upside, equities research analysts clearly believe Douglas Dynamics is more favorable than Komatsu.
Valuation and Earnings
This table compares Douglas Dynamics and Komatsu’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Douglas Dynamics||$474.93 million||2.19||$55.32 million||$1.36||33.86|
|Komatsu||$22.59 billion||1.38||$1.77 billion||$1.88||17.55|
Komatsu has higher revenue and earnings than Douglas Dynamics. Komatsu is trading at a lower price-to-earnings ratio than Douglas Dynamics, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
89.6% of Douglas Dynamics shares are owned by institutional investors. Comparatively, 0.2% of Komatsu shares are owned by institutional investors. 3.1% of Douglas Dynamics shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Douglas Dynamics beats Komatsu on 11 of the 16 factors compared between the two stocks.
Douglas Dynamics Company Profile
Douglas Dynamics, Inc. operates as a manufacturer and up-fitter of commercial work truck attachments and equipment primarily in North America. It operates in two segments, Work Truck Attachments and Work Truck Solutions. The Work Truck Attachments segment manufactures and sells snow and ice control attachments, including snowplows, and sand and salt spreaders for light and heavy duty trucks, as well as various related parts and accessories. It also provides customized turnkey solutions to governmental agencies, such as departments of transportation and municipalities. This segment offers snow and ice management attachments under the BLIZZARD, FISHER, HENDERSON, SNOWEX, and WESTERN brands; turf care equipment under the TURFEX brand; and industrial maintenance equipment under the SWEEPEX brand. It sells its products to professional snowplowers who are contracted to remove snow and ice from commercial, municipal, and residential areas. The Work Truck Solutions segment provides truck and vehicle up-fits where it attaches component pieces of equipment, truck bodies, racking, and storage solutions to a vehicle chassis for use by end users for work related purposes; and manufactures storage solutions for trucks and vans, and cable pulling equipment for trucks. This segment offers up-fit and storage solutions under the DEJANA brand and its related sub-brands. The company was founded in 2004 and is headquartered in Milwaukee, Wisconsin.
Komatsu Company Profile
Komatsu Ltd. engages in the development, manufacture, marketing, and sale of various industrial-use products and services worldwide. The company operates through three segments: Construction, Mining, and Utility Equipment; Retail Finance; and Industrial Machinery and Others. It offers construction, mining, and utility equipment, including hydraulic excavators, mini excavators, backhoe loaders, wheel loaders, mini wheel loaders, skid-steer loaders, bulldozers, motor graders, vibratory rollers, off-highway dump trucks, articulated dump trucks, and crawler carriers. The company also provides forestry equipment, including harvesters, forwarders, and feller bunchers; shield and tunnel-boring machines; recycling equipment, such as mobile crushers, soil recyclers, and mobile tub grinders; forklift trucks; engines and components, such as diesel engines, diesel generator sets, and hydraulic equipment; steel and iron castings; and other equipment comprising railroad maintenance equipment. In addition, it offers metal forging and stamping presses, including large presses, small and medium-sized presses, forging presses, mechanical presses, and servo presses; sheet-metal machines, such as press brakes, shears, laser cutting machines, and fine plasma cutting machines; machine tools, which comprise crankshaft millers, transfer machines, machining centers, grinding machines, and wire saws; and other products consisting of packing and transport, defense-related equipment, thermoelectric modules, and excimer lasers, as well as temperature-control equipment and ultra-violet light sources used for lithography tools for semiconductor manufacturing. Further, the company provides other specific equipment for demolition, slag handling, airport, etc.; periodic replacement parts, attachments, and remanufacturing parts; and retail financing for construction and mining equipment. Komatsu Ltd. was founded in 1884 and is headquartered in Tokyo, Japan.
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