Critical Contrast: Asbury Automotive Group (NYSE:ABG) vs. Titan Machinery (NASDAQ:TITN)

Asbury Automotive Group (NYSE:ABG) and Titan Machinery (NASDAQ:TITN) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, analyst recommendations, profitability, dividends, institutional ownership and risk.

Earnings and Valuation

This table compares Asbury Automotive Group and Titan Machinery”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Asbury Automotive Group	$17.19 billion	0.27	$430.30 million	$27.38	8.72
Titan Machinery	$2.70 billion	0.15	-$36.91 million	($2.70)	-6.32

Asbury Automotive Group has higher revenue and earnings than Titan Machinery. Titan Machinery is trading at a lower price-to-earnings ratio than Asbury Automotive Group, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Asbury Automotive Group has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500. Comparatively, Titan Machinery has a beta of 1.3, meaning that its share price is 30% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Asbury Automotive Group and Titan Machinery, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Asbury Automotive Group	1	4	2	0	2.14
Titan Machinery	0	2	2	2	3.00

Asbury Automotive Group presently has a consensus price target of $249.00, indicating a potential upside of 4.28%. Titan Machinery has a consensus price target of $22.25, indicating a potential upside of 30.35%. Given Titan Machinery’s stronger consensus rating and higher probable upside, analysts plainly believe Titan Machinery is more favorable than Asbury Automotive Group.

Profitability

This table compares Asbury Automotive Group and Titan Machinery’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Asbury Automotive Group	3.13%	15.41%	5.38%
Titan Machinery	-2.37%	-9.99%	-3.28%

Insider and Institutional Ownership

78.4% of Titan Machinery shares are owned by institutional investors. 0.6% of Asbury Automotive Group shares are owned by company insiders. Comparatively, 10.8% of Titan Machinery shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Asbury Automotive Group beats Titan Machinery on 8 of the 14 factors compared between the two stocks.

About Asbury Automotive Group

Asbury Automotive Group, Inc., together with its subsidiaries, operates as an automotive retailer in the United States. It offers a range of automotive products and services, including new and used vehicles; and vehicle repair and maintenance services, replacement parts, and collision repair services. The company also provides finance and insurance products, including arranging vehicle financing through third parties; and aftermarket products, such as extended service contracts, guaranteed asset protection debt cancellation, prepaid maintenance, and disability and accident insurance. Asbury Automotive Group, Inc. was founded in 1996 and is based in Duluth, Georgia.

About Titan Machinery

Titan Machinery Inc. owns and operates a network of full service agricultural and construction equipment stores in the United States, Europe, and Australia. It operates through four segments: Agriculture, Construction, Europe, and Australia. The company sells new and used equipment, including agricultural and construction equipment manufactured under the CNH Industrial family of brands, as well as equipment from various other manufacturers. Its agricultural equipment includes machinery and attachments for use in the production of food, fiber, feed grain, feed stock, and renewable energy; and home and garden applications, as well as maintenance of commercial, residential, and government properties. The company’s construction equipment comprises heavy construction machinery, light industrial machinery for commercial and residential construction, and road and highway construction machinery. It also sells maintenance and replacement parts. In addition, the company offers repair and maintenance services that include warranty repairs, off-site and on-site repair services, scheduling off-season maintenance services, and notifying customers of periodic service requirements; and training programs to customers. Further, it rents equipment; and provides ancillary equipment support services, such as equipment transportation, global positioning system signal subscriptions and other precision farming products, farm data management products, and CNH Industrial finance and insurance products. The company operates in Colorado, Idaho, Kansas, Missouri, Washington, Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, Wisconsin, and Wyoming, the United States; Bulgaria, Germany, Romania, and Ukraine, Europe; and New South Wales, South Australia, and Victoria, Australia. Titan Machinery Inc. was founded in 1980 and is headquartered in West Fargo, North Dakota.