Comparing GEA Group Aktiengesellschaft (OTCMKTS:GEAGY) & IHI (OTCMKTS:IHICY)

IHI (OTCMKTS:IHICY) and GEA Group Aktiengesellschaft (OTCMKTS:GEAGY) are both industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Insider and Institutional Ownership

0.3% of GEA Group Aktiengesellschaft shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares IHI and GEA Group Aktiengesellschaft”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IHI	$10.92 billion	1.55	$1.06 billion	$1.15	13.55
GEA Group Aktiengesellschaft	$5.47 billion	1.34	-$191.04 million	($1.16)	-34.99

IHI has higher revenue and earnings than GEA Group Aktiengesellschaft. GEA Group Aktiengesellschaft is trading at a lower price-to-earnings ratio than IHI, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares IHI and GEA Group Aktiengesellschaft’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IHI	11.10%	28.06%	7.62%
GEA Group Aktiengesellschaft	-3.20%	-7.43%	-2.78%

Analyst Ratings

This is a breakdown of recent ratings and price targets for IHI and GEA Group Aktiengesellschaft, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IHI	0	1	0	0	2.00
GEA Group Aktiengesellschaft	0	1	1	0	2.50

Volatility and Risk

IHI has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, GEA Group Aktiengesellschaft has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.

Dividends

IHI pays an annual dividend of $0.07 per share and has a dividend yield of 0.4%. GEA Group Aktiengesellschaft pays an annual dividend of $0.93 per share and has a dividend yield of 2.3%. IHI pays out 6.1% of its earnings in the form of a dividend. GEA Group Aktiengesellschaft pays out -80.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. GEA Group Aktiengesellschaft is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

IHI beats GEA Group Aktiengesellschaft on 8 of the 14 factors compared between the two stocks.

About IHI

IHI Corporation is a Japanese engineering and manufacturing company headquartered in Tokyo. Its history dates to the founding of Ishikawajima Shipyard in 1853. The company was formed through the 1960 merger of Ishikawajima Heavy Industries and Harima Shipbuilding & Engineering, and adopted the name IHI Corporation in 2007. IHI designs and supplies equipment and systems for energy and industrial applications, including boilers, turbines, compressors and machinery for plants. It also works on infrastructure such as bridges and other large structures, as well as transportation and industrial systems.

About GEA Group Aktiengesellschaft

GEA Group Aktiengesellschaft is a German engineering company that develops and supplies process technology and equipment for industries including food and beverage, pharmaceuticals, chemicals and agriculture. Its systems help customers process, package and handle products and materials. The company’s offerings include equipment and integrated solutions for separation, mixing, homogenization, drying, freezing, filling and packaging. GEA also provides milking and farm technology, as well as industrial heating and refrigeration systems.