Magna International (NYSE: MGA) and Metaldyne Performance Group (NYSE:MPG) are both auto/tires/trucks companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, valuation, profitability and analyst recommendations.

Dividends

Magna International pays an annual dividend of $1.10 per share and has a dividend yield of 2.0%. Metaldyne Performance Group pays an annual dividend of $0.37 per share and has a dividend yield of 1.7%. Magna International pays out 19.9% of its earnings in the form of a dividend. Metaldyne Performance Group pays out 25.7% 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. Metaldyne Performance Group has raised its dividend for 5 consecutive years. Magna International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

59.5% of Magna International shares are held by institutional investors. Comparatively, 18.6% of Metaldyne Performance Group shares are held by institutional investors. 5.1% of Metaldyne Performance Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Magna International and Metaldyne Performance Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Magna International $37.16 billion 0.54 $4.01 billion $5.54 9.72
Metaldyne Performance Group N/A N/A N/A $1.44 15.21

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

Risk & Volatility

Magna International has a beta of 1.46, indicating that its stock price is 46% more volatile than the S&P 500. Comparatively, Metaldyne Performance Group has a beta of 2.07, indicating that its stock price is 107% more volatile than the S&P 500.

Profitability

This table compares Magna International and Metaldyne Performance Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Magna International 5.73% 20.01% 9.12%
Metaldyne Performance Group 2.60% 9.80% 2.11%

Analyst Ratings

This is a breakdown of recent recommendations for Magna International and Metaldyne Performance Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Magna International 1 4 7 1 2.62
Metaldyne Performance Group 0 2 0 0 2.00

Magna International currently has a consensus target price of $52.67, suggesting a potential downside of 2.22%. Metaldyne Performance Group has a consensus target price of $17.50, suggesting a potential downside of 20.09%. Given Magna International’s stronger consensus rating and higher possible upside, equities analysts plainly believe Magna International is more favorable than Metaldyne Performance Group.

Summary

Magna International beats Metaldyne Performance Group on 12 of the 15 factors compared between the two stocks.

Magna International Company Profile

Magna International Inc. (Magna) is a global automotive supplier. The Company’s segments are North America, Europe, Asia, Rest of World, and Corporate and Other. The Company’s product capabilities include producing body, chassis, exterior, seating, powertrain, electronic, active driver assistance, vision, closure, and roof systems and modules, as well as vehicle engineering and contract manufacturing. The Company has over 320 manufacturing operations and approximately 100 product development, engineering and sales centers in over 30 countries. It provides a range of body, chassis and engineering solutions to its original equipment manufacturer (OEM) customers. It has capabilities in powertrain design, development, testing and manufacturing. It offers bumper fascia systems, exterior trim and modular systems. It offers exterior and interior mirror systems. It offers sealing, trim, engineered glass and module systems. It offers softtops, retractable hardtops, modular tops and hardtops.

Metaldyne Performance Group Company Profile

Metaldyne Performance Group Inc. provides components for use in engine, transmission and driveline (Powertrain) and chassis, suspension, steering and brake component (Safety-Critical) Platforms for the global light, commercial and industrial vehicle markets. The Company produces these components using complex metal-forming manufacturing technologies and processes for a customer base of vehicle original equipment manufacturers and Tier I suppliers. The Company operates through three segments: HHI, Metaldyne and Grede. Its metal-forming manufacturing technologies and processes include Aluminum Die Casting, Forging, Iron Casting and Powder Metal Forming, as well as value-added manufacturing processes, such as Advanced Machining and Assembly. These technologies and processes are used to create a range of customized Powertrain and Safety-Critical components that address requirements for power density, power generation, power/torque transfer, strength and noise, vibration and harshness.

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