Critical Review: Visteon (VC) & Its Rivals

Visteon (NASDAQ:VC) is one of 148 public companies in the “Automobile Components” industry, but how does it contrast to its competitors? We will compare Visteon to similar businesses based on the strength of its valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.

Institutional & Insider Ownership

99.7% of Visteon shares are held by institutional investors. Comparatively, 48.4% of shares of all “Automobile Components” companies are held by institutional investors. 2.0% of Visteon shares are held by insiders. Comparatively, 19.6% of shares of all “Automobile Components” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Visteon and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Visteon	$3.77 billion	$201.00 million	14.18
Visteon Competitors	$6.50 billion	$73.97 million	3.17

Visteon’s competitors have higher revenue, but lower earnings than Visteon. Visteon is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

Visteon has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Visteon’s competitors have a beta of 3.87, meaning that their average share price is 287% more volatile than the S&P 500.

Profitability

This table compares Visteon and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Visteon	4.15%	11.36%	5.39%
Visteon Competitors	-40.98%	-0.27%	-1.94%

Dividends

Visteon pays an annual dividend of $1.50 per share and has a dividend yield of 1.8%. Visteon pays out 25.9% of its earnings in the form of a dividend. As a group, “Automobile Components” companies pay a dividend yield of 10.8% and pay out 24.3% of their earnings in the form of a dividend. Visteon lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Analyst Ratings

This is a summary of recent ratings for Visteon and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Visteon	1	4	8	0	2.54
Visteon Competitors	1092	4508	6144	203	2.46

Visteon presently has a consensus target price of $118.00, suggesting a potential upside of 43.43%. As a group, “Automobile Components” companies have a potential upside of 61.96%. Given Visteon’s competitors higher possible upside, analysts plainly believe Visteon has less favorable growth aspects than its competitors.

Summary

Visteon beats its competitors on 8 of the 15 factors compared.

About Visteon

Visteon Corporation is a global automotive technology supplier focused on electronics and software for vehicle cockpits. Its products include digital instrument clusters, infotainment systems, automotive displays, and integrated cockpit computing platforms that bring multiple vehicle functions together. The company also develops connected-car and software solutions for automakers, supporting digital interfaces and information systems in vehicles. Its customers include automakers around the world, and Visteon serves markets across multiple regions.