Strattec Security Corporation (STRT) versus American Axle & Manufacturing Holdings (AXL) Critical Survey
Strattec Security Corporation (NASDAQ: STRT) and American Axle & Manufacturing Holdings (NYSE:AXL) are both small-cap auto/tires/trucks companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, profitabiliy, valuation, dividends and institutional ownership.
Valuation and Earnings
This table compares Strattec Security Corporation and American Axle & Manufacturing Holdings’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Strattec Security Corporation||$417.24 million||0.30||$25.64 million||$1.64||21.01|
|American Axle & Manufacturing Holdings||$4.76 billion||0.34||$815.70 million||$2.95||4.91|
American Axle & Manufacturing Holdings has higher revenue and earnings than Strattec Security Corporation. American Axle & Manufacturing Holdings is trading at a lower price-to-earnings ratio than Strattec Security Corporation, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
86.9% of Strattec Security Corporation shares are owned by institutional investors. 6.8% of Strattec Security Corporation shares are owned by company insiders. Comparatively, 1.0% of American Axle & Manufacturing Holdings shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent ratings for Strattec Security Corporation and American Axle & Manufacturing Holdings, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Strattec Security Corporation||0||0||0||0||N/A|
|American Axle & Manufacturing Holdings||2||2||8||0||2.50|
American Axle & Manufacturing Holdings has a consensus price target of $19.44, suggesting a potential upside of 34.28%. Given American Axle & Manufacturing Holdings’ higher probable upside, analysts clearly believe American Axle & Manufacturing Holdings is more favorable than Strattec Security Corporation.
Risk & Volatility
Strattec Security Corporation has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500. Comparatively, American Axle & Manufacturing Holdings has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500.
Strattec Security Corporation pays an annual dividend of $0.56 per share and has a dividend yield of 1.6%. American Axle & Manufacturing Holdings does not pay a dividend. Strattec Security Corporation pays out 34.1% of its earnings in the form of a dividend.
This table compares Strattec Security Corporation and American Axle & Manufacturing Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Strattec Security Corporation||1.44%||3.80%||2.41%|
|American Axle & Manufacturing Holdings||5.32%||42.42%||6.42%|
American Axle & Manufacturing Holdings beats Strattec Security Corporation on 10 of the 15 factors compared between the two stocks.
Strattec Security Corporation Company Profile
Strattec Security Corporation designs, develops, manufactures and markets automotive access control products. The Company offers access control products, including mechanical locks and keys, electronically enhanced locks and keys, steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power lift gate systems, power deck lid systems, door handles and related products for North American automotive customers. The Company supplies its products under the VAST brand name. The Company’s products are shipped to customer locations in the United States, Canada, Mexico, Europe, South America, Korea and China, and it also provides full service and aftermarket support. The Company provides its customers with engineered access control products, including locksets, fobs, push button ignition systems, steering column lock housings, seatback and secondary power liftgate systems, power decklids, door handles, and trim and other access products.
American Axle & Manufacturing Holdings Company Profile
American Axle & Manufacturing Holdings, Inc. (AAM) manufactures, engineers, designs and validates driveline and drivetrain systems and related components and chassis modules for light trucks, sport utility vehicles, crossover vehicles, passenger cars and commercial vehicles. Its driveline and drivetrain systems include components that transfer power from the transmission and deliver it to the drive wheels. Its driveline, drivetrain and related products include axles, driveheads, chassis modules, driveshafts, power transfer units, transfer cases, chassis and steering components, transmission parts, electric drive systems and metal-formed products. The Company’s subsidiary, e-AAM Driveline Systems AB (e-AAM), engineers and develops battery electric and hybrid driveline systems to be commercialized for crossover vehicles and passenger cars. As of April 6, 2017, it operated in 17 countries and had approximately 90 manufacturing, engineering and business office facilities around the world.
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