Franklin Electric (NASDAQ:FELE) versus NN (NASDAQ:NNBR) Critical Survey

NN (NASDAQ:NNBR) and Franklin Electric (NASDAQ:FELE) are both industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, valuation, analyst recommendations, earnings, profitability and institutional ownership.

Institutional & Insider Ownership

53.9% of NN shares are owned by institutional investors. Comparatively, 80.0% of Franklin Electric shares are owned by institutional investors. 5.6% of NN shares are owned by insiders. Comparatively, 2.9% of Franklin Electric shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings for NN and Franklin Electric, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NN	1	1	2	1	2.60
Franklin Electric	0	2	1	0	2.33

NN currently has a consensus target price of $5.67, suggesting a potential upside of 53.15%. Franklin Electric has a consensus target price of $114.50, suggesting a potential upside of 15.16%. Given NN’s stronger consensus rating and higher probable upside, research analysts clearly believe NN is more favorable than Franklin Electric.

Volatility & Risk

NN has a beta of 2.65, indicating that its stock price is 165% more volatile than the S&P 500. Comparatively, Franklin Electric has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.

Earnings & Valuation

This table compares NN and Franklin Electric”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NN	$422.21 million	0.82	-$34.00 million	($0.96)	-3.85
Franklin Electric	$2.13 billion	2.06	$147.09 million	$3.47	28.65

Franklin Electric has higher revenue and earnings than NN. NN is trading at a lower price-to-earnings ratio than Franklin Electric, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares NN and Franklin Electric’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NN	-6.21%	20.38%	1.49%
Franklin Electric	7.06%	15.18%	10.13%

Summary

Franklin Electric beats NN on 8 of the 15 factors compared between the two stocks.

About NN

NN, Inc., together with its subsidiaries, designs, manufactures, and sells high-precision components and assemblies for various end markets in the United States and internationally. It operates through two segments, Mobile Solutions and Power Solutions. The Mobile Solutions segment manufactures and sells system critical components for automotive, general industrial, and medical end markets for use in power steering, braking, transmissions, gasoline fuel system, diesel injection, and diesel emissions treatment applications, as well as in heating, ventilation, and air conditioning. The Power Solutions segment designs, manufactures, and sells a range of high-precision metal and plastic components, assemblies, and finished devices used in various applications, such as power control and transportation electrification. Its products include electrical contacts, connectors, contact assemblies, and precision stampings for the electrical, general industrial, automotive, aerospace and defense, and medical end markets. This segment also produces various tools and instruments for the orthopaedics and medical/surgical end markets. NN, Inc. was founded in 1980 and is headquartered in Charlotte, North Carolina.

About Franklin Electric

Franklin Electric Co., Inc., together with its subsidiaries, designs, manufactures, and distributes water and fuel pumping systems worldwide. The company operates through Water Systems, Fueling Systems, and Distribution segments. The Water Systems segment offers submersible motors, drives, pumps, electronic controls, water treatment systems, monitoring devices, and related parts and equipment. Its motors and pumps are used principally for pumping clean water and wastewater in various residential, agricultural, municipal, and industrial applications; and manufactures electronic drives and controls that are used in motors for controlling functionality, as well as provides protection from various hazards, such as electrical surges, over-heating, and dry wells or tanks. The Fueling Systems segment provides pumps, pipes, sumps, fittings, vapor recovery components, electronic controls, monitoring devices, and related parts and equipment primarily for use in fueling system applications. This segment serves other energy markets, such as power reliability systems, as well as includes electronic devices for online monitoring of the power utility, hydroelectric, and telecommunication and data center infrastructure. The Distribution segment sells to and provides presale support and specifications to the installing contractors. It sells products produced by the Water Systems segment. The company sells its products to wholesale and retail distributors, specialty distributors, original equipment manufacturers, industrial and petroleum equipment distributors, and oil and utility companies through its employee sales force and independent manufacturing representatives. Franklin Electric Co., Inc. was founded in 1944 and is headquartered in Fort Wayne, Indiana.