Analyzing LCI Industries (LCII) and Horizon Global (HZN)

LCI Industries (NYSE: LCII) and Horizon Global (NYSE:HZN) are both auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, profitability, institutional ownership, risk, analyst recommendations, earnings and valuation.

Insider & Institutional Ownership

94.5% of LCI Industries shares are owned by institutional investors. Comparatively, 80.6% of Horizon Global shares are owned by institutional investors. 3.6% of LCI Industries shares are owned by company insiders. Comparatively, 1.9% of Horizon Global shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

LCI Industries pays an annual dividend of $2.40 per share and has a dividend yield of 2.4%. Horizon Global does not pay a dividend. LCI Industries pays out 41.7% of its earnings in the form of a dividend.

Profitability

This table compares LCI Industries and Horizon Global’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LCI Industries 5.92% 23.39% 14.69%
Horizon Global -15.61% 8.57% 1.34%

Analyst Recommendations

This is a breakdown of current ratings for LCI Industries and Horizon Global, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LCI Industries 0 1 2 0 2.67
Horizon Global 1 2 3 0 2.33

LCI Industries presently has a consensus target price of $107.00, indicating a potential upside of 9.02%. Horizon Global has a consensus target price of $13.58, indicating a potential upside of 77.79%. Given Horizon Global’s higher possible upside, analysts clearly believe Horizon Global is more favorable than LCI Industries.

Risk and Volatility

LCI Industries has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, Horizon Global has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500.

Earnings and Valuation

This table compares LCI Industries and Horizon Global’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LCI Industries $2.15 billion 1.15 $132.88 million $5.76 17.04
Horizon Global $892.98 million 0.21 -$3.55 million $0.98 7.80

LCI Industries has higher revenue and earnings than Horizon Global. Horizon Global is trading at a lower price-to-earnings ratio than LCI Industries, indicating that it is currently the more affordable of the two stocks.

Summary

LCI Industries beats Horizon Global on 12 of the 16 factors compared between the two stocks.

About LCI Industries

LCI Industries, along with its subsidiaries, manufactures and supplies components for the manufacturers of recreational vehicles (RVs) and adjacent industries in the United States and internationally. It operates in two segments, Original Equipment Manufacturers (OEM) and Aftermarket. The OEM segment manufactures or distributes various components for the OEMs of RVs and adjacent industries, including buses; trailers used to haul boats, livestock, equipment, and other cargo; travel trailers, fifth-wheel travel trailers, folding camping trailers, and truck campers; trucks; pontoon boats; trains; manufactured homes; and modular housing. Its products include steel chassis and related components; axles and suspension solutions; slide-out mechanisms and solutions; thermoformed bath, kitchen, and other products; vinyl, aluminum, and frameless windows; manual, electric, and hydraulic stabilizer and leveling systems; entry, luggage, patio, and ramp doors; furniture and mattresses; electric and manual entry steps; awnings and awning accessories; electronic components; appliances; televisions and sound systems; navigation systems; backup cameras; and other accessories. The Aftermarket segment supplies various components of RV and adjacent industries to retail dealers, wholesale distributors, and service centers. It also sells replacement glass and awnings to fulfill insurance claims. The company was formerly known as Drew Industries Incorporated and changed its name to LCI Industries in December 2016. LCI Industries was founded in 1962 and is based in Elkhart, Indiana.

About Horizon Global

Horizon Global Corporation designs, manufactures, and distributes a range of towing, trailering, cargo management, and other related accessory products to the automotive aftermarket, retail, and original equipment channels worldwide. It operates through three segments: Horizon Americas, Horizon Asia-Pacific, and Horizon Europe-Africa. The company provides towing products, such as hitches, fifth wheels, gooseneck hitches, weight distribution systems, wiring harnesses, draw bars, ball mounts, crossbars, towbars, security, and other towing accessories for attaching a trailer, camper, etc. It also offers trailering products, including brake controls, jacks, winches, couplers, interior and exterior vehicle lighting, and brake replacement parts. In addition, the company provides cargo management products, such as bike racks, roof cross bar systems, cargo carriers, luggage boxes, car interior protective products, ropes, tie-downs, tarps, bungee cords, loading ramps, and interior travel organizers. Further, it offers other products comprising tubular push and sports bars, side steps, skid plates, and oil pans. Horizon Global Corporation provides its products under the Reese, Hayman-Reese, Draw-Tite, and Westfalia, as well as Aqua Clear, Bulldog, BTM, DHF, Engetran, Fulton, Kovil, Parkside, Reese Secure, Reese Explorer, Reese Power Sports, Reese Towpower, ROLA, Tekonsha, Trojan, WesBarg, and Witter Towbar Systems brands. The company offers its products through original equipment manufacturers and suppliers, as well as aftermarket and retail customers in the agricultural, automotive, construction, fleet, horse/livestock, industrial, marine, military, recreational, trailer, and utility markets, and mining and municipalities; and serves end consumers through independent installers, warehouse distributors, dealers, original equipment, retail stores, and online retailers. Horizon Global Corporation was incorporated in 2015 is headquartered in Troy, Michigan.

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