Contrasting Sandvik (OTCMKTS:SDVKY) and Greenbrier Companies (NYSE:GBX)

Greenbrier Companies (NYSE:GBX) and Sandvik (OTCMKTS:SDVKY) are both industrials companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, risk, institutional ownership, earnings, valuation and profitability.

Insider and Institutional Ownership

95.6% of Greenbrier Companies shares are owned by institutional investors. Comparatively, 0.7% of Sandvik shares are owned by institutional investors. 1.7% of Greenbrier Companies shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations for Greenbrier Companies and Sandvik, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Greenbrier Companies	1	3	0	0	1.75
Sandvik	1	8	3	1	2.31

Greenbrier Companies currently has a consensus target price of $45.00, suggesting a potential upside of 4.37%. Given Greenbrier Companies’ higher probable upside, equities analysts plainly believe Greenbrier Companies is more favorable than Sandvik.

Dividends

Greenbrier Companies pays an annual dividend of $1.36 per share and has a dividend yield of 3.2%. Sandvik pays an annual dividend of $0.42 per share and has a dividend yield of 1.1%. Greenbrier Companies pays out 40.4% of its earnings in the form of a dividend. Sandvik pays out 29.0% 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. Greenbrier Companies has increased its dividend for 3 consecutive years. Greenbrier Companies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Greenbrier Companies has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500. Comparatively, Sandvik has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500.

Valuation & Earnings

This table compares Greenbrier Companies and Sandvik”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Greenbrier Companies	$3.24 billion	0.41	$204.10 million	$3.37	12.79
Sandvik	$12.34 billion	3.91	$1.50 billion	$1.45	26.50

Sandvik has higher revenue and earnings than Greenbrier Companies. Greenbrier Companies is trading at a lower price-to-earnings ratio than Sandvik, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Greenbrier Companies and Sandvik’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Greenbrier Companies	4.07%	6.49%	2.55%
Sandvik	13.05%	18.45%	9.99%

Summary

Sandvik beats Greenbrier Companies on 12 of the 18 factors compared between the two stocks.

About Greenbrier Companies

The Greenbrier Companies, Inc. designs, manufactures, and markets railroad freight car equipment in North America, Europe, and South America. It operates through three segments: Manufacturing; Maintenance Services; and Leasing & Management Services. The Manufacturing segment offers covered hopper cars, gondolas, open top hoppers, boxcars, center partition cars, tank cars, sustainable conversions, double-stack railcars, auto-max ii, multi-max, and multi-max plus products, intermodal cars, automobile transport, coil steel and metals, flat cars, sliding wall cars, pressurized tank cars, and non-pressurized tank cars. The Maintenance Services segment provides wheel services, including reconditioning of wheels and axles, new axle machining and finishing, and downsizing; operates a railcar repair, refurbishment, and maintenance network; and reconditions and manufactures railcar cushioning units, couplers, yokes, side frames, bolsters, and various other parts. The Leasing & Management Services segment offers operating leases and per diem leases for a fleet of approximately 13,400 railcars; and management services comprising railcar maintenance management, railcar accounting services, fleet management and logistics, administration, and railcar re-marketing. This segment provides management services for railroads, shippers, carriers, institutional investors, and other leasing and transportation companies. It serves railroads, leasing companies, financial institutions, shippers, carriers, and transportation companies. The company was founded in 1974 and is headquartered in Lake Oswego, Oregon.

About Sandvik

Sandvik AB (publ), an engineering company, provides products and solutions for mining and rock excavation, metal cutting, and materials technology worldwide. The company offers mining and rock excavation equipment, including drill rigs and bolters, underground loaders and trucks, mechanical cutting equipment, rock tools and rock drills, and mining automation; rock processing equipment, such as crushers, screens, hydraulic breakers, demolition tools, and breaker booms. It also provides metal-cutting tools and tooling systems, and digital solutions and software; metal powder for additive manufacturing, and components made from controlled expansion alloys; and tungsten powders, as well as recycling services of secondary tungsten raw materials. The company serves aerospace, automotive, energy, general engineering, infrastructure, and mining industries. Sandvik AB (publ) was founded in 1862 and is headquartered in Stockholm, Sweden.