PACCAR (PCAR) & Hyster-Yale Materials Handling (HY) Critical Comparison
PACCAR (NASDAQ: PCAR) and Hyster-Yale Materials Handling (NYSE:HY) are both auto/tires/trucks companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, profitability, risk, institutional ownership and analyst recommendations.
Risk & Volatility
PACCAR has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, Hyster-Yale Materials Handling has a beta of 1.05, suggesting that its share price is 5% more volatile than the S&P 500.
Earnings and Valuation
This table compares PACCAR and Hyster-Yale Materials Handling’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PACCAR||$17.26 billion||1.30||$2.36 billion||$3.74||17.06|
|Hyster-Yale Materials Handling||$2.72 billion||0.31||$101.90 million||$3.58||18.96|
PACCAR has higher revenue and earnings than Hyster-Yale Materials Handling. PACCAR is trading at a lower price-to-earnings ratio than Hyster-Yale Materials Handling, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
62.3% of PACCAR shares are owned by institutional investors. Comparatively, 69.1% of Hyster-Yale Materials Handling shares are owned by institutional investors. 2.6% of PACCAR shares are owned by insiders. Comparatively, 26.3% of Hyster-Yale Materials Handling shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a breakdown of current ratings and price targets for PACCAR and Hyster-Yale Materials Handling, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Hyster-Yale Materials Handling||0||1||2||0||2.67|
PACCAR presently has a consensus target price of $71.87, indicating a potential upside of 12.61%. Hyster-Yale Materials Handling has a consensus target price of $74.00, indicating a potential upside of 9.03%. Given PACCAR’s higher probable upside, analysts clearly believe PACCAR is more favorable than Hyster-Yale Materials Handling.
This table compares PACCAR and Hyster-Yale Materials Handling’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Hyster-Yale Materials Handling||2.17%||11.73%||4.33%|
PACCAR pays an annual dividend of $1.00 per share and has a dividend yield of 1.6%. Hyster-Yale Materials Handling pays an annual dividend of $1.21 per share and has a dividend yield of 1.8%. PACCAR pays out 26.7% of its earnings in the form of a dividend. Hyster-Yale Materials Handling pays out 33.8% 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. PACCAR has increased its dividend for 4 consecutive years.
PACCAR beats Hyster-Yale Materials Handling on 12 of the 17 factors compared between the two stocks.
PACCAR Inc (PACCAR) is a technology company. The Company’s segments include Truck, Parts and Financial Services. The Truck segment includes the design, manufacture and distribution of light-, medium- and heavy-duty commercial trucks. The Company’s trucks are marketed under the Kenworth, Peterbilt and DAF nameplates. It also manufactures engines, primarily for use in the Company’s trucks, at its facilities in Columbus, Mississippi; Eindhoven, the Netherlands, and Ponta Grossa, Brazil. The Parts segment includes the distribution of aftermarket parts for trucks and related commercial vehicles. The Financial Services segment includes finance and leasing products and services provided to customers and dealers. Its Other business includes the manufacturing and marketing of industrial winches. The Company operates in Australia and Brazil and sells trucks and parts to customers in Asia, Africa, Middle East and South America.
About Hyster-Yale Materials Handling
Hyster-Yale Materials Handling, Inc. is a lift truck manufacturer. The Company designs, engineers, manufactures, sells and services a line of lift trucks, attachments and aftermarket parts marketed globally under the Hyster and Yale brand names, mainly to independent Hyster and Yale retail dealerships. The Company operates through five segments: the Americas, EMEA, JAPIC, Bolzoni and Nuvera. The Company offers a range of solutions, including attachments and hydrogen fuel cell power products, telematics, automation and fleet management services, as well as an array of other power options for its lift trucks. The Company’s segments for the lift truck business include three management units: the Americas, EMEA and JAPIC. Americas includes operations in the United States, Canada, Mexico, Brazil, Latin America and its corporate headquarters. EMEA includes operations in Europe, the Middle East and Africa. JAPIC includes operations in the Asia and Pacific regions including China.
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