Alamo Group (NYSE: ALG) and CNH Global NV (NYSE:CNH) are both agricultural machinery companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Insider and Institutional Ownership

87.7% of Alamo Group shares are owned by institutional investors. 4.0% of Alamo Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Alamo Group and CNH Global NV’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Alamo Group $844.75 million 1.56 $40.04 million $4.17 27.17
CNH Global NV N/A N/A N/A $5.40 N/A

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Alamo Group and CNH Global NV, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alamo Group 0 1 1 0 2.50
CNH Global NV 0 0 0 0 N/A

Alamo Group currently has a consensus price target of $92.00, indicating a potential downside of 18.79%.

Dividends

Alamo Group pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. CNH Global NV does not pay a dividend. Alamo Group pays out 9.6% of its earnings in the form of a dividend. CNH Global NV has increased its dividend for 2 consecutive years.

Profitability

This table compares Alamo Group and CNH Global NV’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alamo Group 5.56% 12.11% 7.87%
CNH Global NV N/A N/A N/A

Summary

Alamo Group beats CNH Global NV on 8 of the 11 factors compared between the two stocks.

Alamo Group Company Profile

Alamo Group Inc. is engaged in the design and manufacture of agricultural equipment and infrastructure maintenance equipment for governmental and industrial use. The Company operates in Industrial, Agricultural and European segments. The Company’s products include tractor-mounted mowing and other vegetation maintenance equipment, street sweepers, excavators, vacuum trucks, snow removal equipment, pothole patchers, zero turn radius mowers, agricultural implements and related aftermarket. As of December 31, 2016, the Company operated 24 plants in North America, Europe, Australia and Brazil. The Company sells its products through a network of independent dealers and distributors to Governmental end users, related independent contractors, as well as to the agricultural and commercial turf markets. It also offers replacement parts for each of its wholegoods lines. The Company’s products are sold through various marketing organizations, and dealer and distributor networks.

CNH Global NV Company Profile

CNH Global N.V. (CNH) is a global, full-line company in both the agricultural and construction equipment industries. The Company organizes its operations into three business segments: agricultural equipment, construction equipment and financial services. The Company markets its products globally through its two brand families, Case and New Holland. Case IH (along with Steyr in Europe) and New Holland make up its agricultural brand family. Case and New Holland Construction (along with Kobelco in North America) make up its construction equipment brand family. During the year ended December 31, 2012, the Company was manufacturing its products in 37 facilities globally and distributing its products in approximately 170 countries through a network of approximately 11,500 dealers and distributors.

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