Panasonic (OTCMKTS:PCRFY) and Smith & Wesson Brands (NASDAQ:SWBI) Head-To-Head Comparison

Smith & Wesson Brands (NASDAQ:SWBI) and Panasonic (OTCMKTS:PCRFY) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Volatility and Risk

Smith & Wesson Brands has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500. Comparatively, Panasonic has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.

Dividends

Smith & Wesson Brands pays an annual dividend of $0.52 per share and has a dividend yield of 3.6%. Panasonic pays an annual dividend of $0.18 per share and has a dividend yield of 1.9%. Smith & Wesson Brands pays out 96.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Panasonic pays out 11.7% of its earnings in the form of a dividend. Smith & Wesson Brands has increased its dividend for 4 consecutive years. Smith & Wesson Brands is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Smith & Wesson Brands and Panasonic”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Smith & Wesson Brands	$523.84 million	1.24	$18.48 million	$0.54	26.89
Panasonic	$62.02 billion	0.35	$1.96 billion	$1.54	6.08

Panasonic has higher revenue and earnings than Smith & Wesson Brands. Panasonic is trading at a lower price-to-earnings ratio than Smith & Wesson Brands, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

59.3% of Smith & Wesson Brands shares are held by institutional investors. Comparatively, 9.4% of Panasonic shares are held by institutional investors. 2.3% of Smith & Wesson Brands shares are held by company insiders. Comparatively, 1.0% of Panasonic shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Smith & Wesson Brands and Panasonic’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Smith & Wesson Brands	4.44%	6.60%	4.59%
Panasonic	5.96%	12.00%	5.82%

Analyst Recommendations

This is a summary of current ratings and target prices for Smith & Wesson Brands and Panasonic, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Smith & Wesson Brands	0	2	1	0	2.33
Panasonic	0	1	0	0	2.00

Smith & Wesson Brands currently has a consensus target price of $16.50, suggesting a potential upside of 13.64%. Given Smith & Wesson Brands’ stronger consensus rating and higher probable upside, equities analysts clearly believe Smith & Wesson Brands is more favorable than Panasonic.

Summary

Smith & Wesson Brands beats Panasonic on 9 of the 17 factors compared between the two stocks.

About Smith & Wesson Brands

Smith & Wesson Brands, Inc. is a holding company, which engages in the manufacture, design, and provision of firearms. Its portfolio includes handguns, long guns, handcuffs, suppressor, and other firearm-related products. The firm’s brands are Smith & Wesson, M&P, Thompson/Center Arms, and Gemtech. The company was founded by Horace Smith and Daniel Baird Wesson in 1852 and is headquartered in Maryville, TN.

About Panasonic

Panasonic Holdings Corporation, together with its subsidiaries, research, develops, manufactures, sells, and services various electrical and electronic products worldwide. It operates through five segments: Lifestyle, Automotive, Connect, Industry, and Energy. The Lifestyle segment offers refrigerators, microwave ovens, rice cookers, washing machines, lighting fixtures, vacuum cleaners, air-conditioners, air to water heat pump system, air purifiers/sterilizers, and freezing or refrigerating showcases, as well as ventilation and perflation equipment. This segment also provides personal-care products; lamps, wiring devices, solar photovoltaic systems, fuel cells, and compressors; bicycles; and nursing care services. The Automotive segment offers infotainment systems, head-up displays, automotive speakers and switches, advanced driver assistance systems, and related devices, as well as systems and devices for xEVs and interior rearview mirrors. The Connect segment provides aircraft in-flight entertainment systems and communications services; electronic components-mounting machines; welding equipment; projectors; professional AV systems; PCs and tablets; solutions for various industries; installation/operation/ maintenance services; and supply chain management software. The Industry segment offers relays, switches, power supply products, touch panels, motors, sensors, laser markers, capacitors, inductors, resistors, circuit board materials, semiconductor device materials, molding compounds, and LCD panels. The Energy segment provides dry, primary/secondary lithium, nickel-metal hydride, and lithium-ion batteries; and cylindrical lithium-ion batteries for in-vehicle use, as well as storage battery modules and systems. It also offers digital cameras, video and audio equipment, television, telephones, and intercoms. The company was formerly known as Panasonic Corporation. Panasonic Holdings Corporation was founded in 1918 and is headquartered in Kadoma, Japan.