Critical Comparison: BRP (NASDAQ:DOOO) & Schaeffler (OTCMKTS:SCFLF)

Schaeffler (OTCMKTS:SCFLF) and BRP (NASDAQ:DOOO) are both auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, institutional ownership, analyst recommendations, risk, valuation, dividends and profitability.

Profitability

This table compares Schaeffler and BRP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Schaeffler	-4.73%	-10.43%	-1.77%
BRP	0.45%	67.30%	4.72%

Earnings and Valuation

This table compares Schaeffler and BRP”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Schaeffler	$19.68 billion	N/A	-$683.89 million	($1.31)	-3.66
BRP	$8.03 billion	0.71	-$154.60 million	$0.37	212.41

BRP has lower revenue, but higher earnings than Schaeffler. Schaeffler is trading at a lower price-to-earnings ratio than BRP, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Schaeffler and BRP, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Schaeffler	0	0	1	0	3.00
BRP	0	5	9	3	2.88

BRP has a consensus price target of $84.40, suggesting a potential upside of 7.39%. Given BRP’s higher possible upside, analysts clearly believe BRP is more favorable than Schaeffler.

Summary

BRP beats Schaeffler on 9 of the 11 factors compared between the two stocks.

About Schaeffler

Schaeffler AG, together with its subsidiaries, develops, manufactures, and sells components and system for industrial applications in Europe, the Americas, China, and the Asia Pacific. The Automotive Technologies division offers mechanical, mechatronic, and electronic components and systems for powertrain electrification used in passenger cars and commercial vehicles, such as electric motors, axle transmissions, axle drives, power electronics, hybrid modules, electromechanical and hydraulic actuators, and thermal management module; torque converters, hybrid dampers, clutches, variable valve train systems, valve-lash adjustment elements, balancer shafts, camshaft phasing systems, timing drives, and front end auxillary drives. This division provides rolling bearing application and products, such as wheel, ball, and needle roller bearings; and mechanical components and mechatronic systems for steering and other chassis applications, including Space Drive, a steer-by-wire system. The Automotive Aftermarket division offers components and repair solutions for light commercial vehicles, trucks and buses, and offroad sectors under the LuK, INA, and FAG brand names, as well as service for repair shops under the REPXPERT brand. The Industrial division develops and manufactures rotary and linear bearing solutions, drive technology components and systems, and service solutions, such as sensor-based condition monitoring systems. This division serves customers in the wind, raw materials, aerospace, rail, offroad, two wheelers, power transmission, and industrial automation sectors. The company was formerly known as INA Beteiligungsgesellschaft mit beschränkter Haftung and changed its name to Schaeffler AG in October 2014. The company was founded in 1946 and is headquartered in Herzogenaurach, Germany. Schaeffler AG is a subsidiary of IHO Verwaltungs GmbH.

About BRP

BRP Inc., together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in the United States, Canada, Europe, the Asia Pacific, Mexico, Austria, and internationally. The Powersports segment offers year-round products, such as Can-Am all-terrain vehicles, side-by-side vehicles, and three-wheeled vehicles; and seasonal products, including Ski-Doo and Lynx snowmobiles, Sea-Doo personal watercrafts and pontoons, Rotax engines for karts and recreational aircraft, and Pinion gearboxes with smart shift systems. The Marine segment provides Alumacraft, Manitou, Quintrex, Stacer, and Yellowfin boats; Rotax engines for jet boats; and Rotax S outboard engine. The company was formerly known as J.A. Bombardier (J.A.B.) Inc. and changed its name to BRP Inc. in April 2013. BRP Inc. was founded in 1937 and is headquartered in Valcourt, Canada.