Regal Beloit Corporation (NYSE: RBC) and Aerohive Networks (NYSE:HIVE) are both industrial products companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Regal Beloit Corporation and Aerohive Networks, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Regal Beloit Corporation 0 6 3 0 2.33
Aerohive Networks 0 3 3 0 2.50

Regal Beloit Corporation presently has a consensus target price of $81.40, indicating a potential upside of 10.30%. Aerohive Networks has a consensus target price of $6.05, indicating a potential upside of 77.88%. Given Aerohive Networks’ stronger consensus rating and higher probable upside, analysts clearly believe Aerohive Networks is more favorable than Regal Beloit Corporation.

Dividends

Regal Beloit Corporation pays an annual dividend of $1.04 per share and has a dividend yield of 1.4%. Aerohive Networks does not pay a dividend. Regal Beloit Corporation pays out 23.0% of its earnings in the form of a dividend. Aerohive Networks has raised its dividend for 7 consecutive years.

Earnings and Valuation

This table compares Regal Beloit Corporation and Aerohive Networks’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Regal Beloit Corporation $3.25 billion 1.01 $469.10 million $4.53 16.29
Aerohive Networks $160.72 million 0.92 -$23.73 million ($0.57) -5.96

Regal Beloit Corporation has higher revenue and earnings than Aerohive Networks. Aerohive Networks is trading at a lower price-to-earnings ratio than Regal Beloit Corporation, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

92.2% of Regal Beloit Corporation shares are held by institutional investors. Comparatively, 44.7% of Aerohive Networks shares are held by institutional investors. 2.2% of Regal Beloit Corporation shares are held by company insiders. Comparatively, 26.2% of Aerohive Networks shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Regal Beloit Corporation and Aerohive Networks’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Regal Beloit Corporation 6.29% 9.88% 4.79%
Aerohive Networks -18.58% -107.93% -21.00%

Volatility and Risk

Regal Beloit Corporation has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500. Comparatively, Aerohive Networks has a beta of 1.48, meaning that its stock price is 48% more volatile than the S&P 500.

Summary

Regal Beloit Corporation beats Aerohive Networks on 10 of the 15 factors compared between the two stocks.

About Regal Beloit Corporation

Regal Beloit Corporation is a manufacturer of electric motors, electrical motion controls, power generation and power transmission products. The Company operates through three segments: the Commercial and Industrial Systems segment, with its principal line of business in medium and large electric motors, power generation products, high-performance drives and controls and capacitors; the Climate Solutions segment, with its principal line of business in small motors, controls and air moving products, and the Power Transmission Solutions segment, with its principal line of business in power transmission gearing, hydraulic pump drives, open gearing and specialty mechanical products which control motion and torque. It sells its products directly to original equipment manufacturers (OEMs), distributors and end users. It operates distribution facilities in Plainfield, Indiana; McAllen, Texas; LaVergne, Tennessee, and Florence, Kentucky.

About Aerohive Networks

Aerohive Networks, Inc. together with its subsidiaries, has designed and developed a cloud-managed mobile networking platform that enables enterprises to deploy and manage a mobile-centric network edge. Its portfolio of products and solutions is built around sets of technologies and solutions, which include Enterprise Cloud Networking, Wireless Fidelity (Wi-Fi) Connectivity and Application and Insights. It conducts its business in geographic regions, including Americas; Europe, the Middle East and Africa, and Asia Pacific. Its product portfolio includes hardware products, cloud-based network management and applications, and support services. Its hardware products include access points, branch routers and access switches. Its hardware products are developed by its hardware design team working in conjunction with original design manufacturer partners, and leverage the commercially available Wi-Fi radios, network processors, crypto accelerators and switching chips.

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