Contrasting Brink’s (NYSE:BCO) and Ennis (NYSE:EBF)

Ennis (NYSE:EBF) and Brink’s (NYSE:BCO) are both industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Insider and Institutional Ownership

74.3% of Ennis shares are owned by institutional investors. Comparatively, 95.0% of Brink’s shares are owned by institutional investors. 3.2% of Ennis shares are owned by company insiders. Comparatively, 1.0% of Brink’s shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Ennis and Brink’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ennis	10.84%	13.89%	11.89%
Brink’s	3.30%	87.18%	4.95%

Risk & Volatility

Ennis has a beta of 0.27, meaning that its stock price is 73% less volatile than the S&P 500. Comparatively, Brink’s has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.

Earnings & Valuation

This table compares Ennis and Brink’s”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ennis	$392.40 million	1.37	$42.63 million	$1.67	12.73
Brink’s	$5.26 billion	0.83	$199.70 million	$4.32	24.54

Brink’s has higher revenue and earnings than Ennis. Ennis is trading at a lower price-to-earnings ratio than Brink’s, indicating that it is currently the more affordable of the two stocks.

Dividends

Ennis pays an annual dividend of $1.00 per share and has a dividend yield of 4.7%. Brink’s pays an annual dividend of $1.02 per share and has a dividend yield of 1.0%. Ennis pays out 59.9% of its earnings in the form of a dividend. Brink’s pays out 23.6% 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. Brink’s has increased its dividend for 5 consecutive years.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Ennis and Brink’s, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ennis	0	1	0	0	2.00
Brink’s	0	2	2	0	2.50

Brink’s has a consensus price target of $154.00, indicating a potential upside of 45.29%. Given Brink’s’ stronger consensus rating and higher probable upside, analysts plainly believe Brink’s is more favorable than Ennis.

Summary

Brink’s beats Ennis on 12 of the 17 factors compared between the two stocks.

About Ennis

Ennis, Inc. manufactures and sells business forms and other business products in the United States. The company offers snap sets, continuous forms, laser cut sheets, tags, labels, envelopes, integrated products, jumbo rolls, and pressure sensitive products under the Ennis, Royal Business Forms, Block Graphics, 360º Custom Labels, ColorWorx, Enfusion, Uncompromised Check Solutions, VersaSeal, Ad Concepts, FormSource Limited, Star Award Ribbon Company, Witt Printing, B&D Litho, Genforms, PrintGraphics, Calibrated Forms, PrintXcel, Printegra, Forms Manufacturers, Mutual Graphics, TRI-C Business Forms, Major Business Systems, Independent Printing, Hoosier Data Forms, Hayes Graphics, Wright Business Graphics, Wright 360, Integrated Print & Graphics, the Flesh Company, Impressions Direct, and AmeriPrint brands. It also provides point of purchase advertising under the Adams McClure brand name; presentation and document folders under the Admore, Folder Express, and Independent Folders brands; and custom printed, high-performance labels, and custom and stock tags under the Ennis Tag & Label brand name. In addition, the company offers custom and stock tags and labels under the Allen-Bailey Tag & Label, Atlas Tag & Label, Kay Toledo Tag, and Special Service Partners brands; custom and imprinted envelopes under the Trade Envelopes, Block Graphics, Wisco, and National Imprint Corporation brands; and financial and security documents under the Northstar and General Financial Supply brands; and custom and stock pressure seal documents under the Infoseal and PrintXcel brands. It distributes business products and forms through independent distributors, including business forms distributors, resellers, direct mail, commercial printers, payroll and accounts payable software companies, and advertising agencies. The company was formerly known as Ennis Business Forms, Inc. Ennis, Inc. was incorporated in 1909 and is headquartered in Midlothian, Texas.

About Brink’s

The Brink’s Co. engages in providing cash management services, digital retail solutions, and ATM managed services. It operates through the following geographical segments: North America, Latin America, Europe, and Rest of World. The North America segment operates in the U.S. and Canada. The Latin America segment refers to the operations in Latin American countries. The Europe segment relates to operations in European countries. The Rest of World segment focuses on the operations in the Middle East, Africa, and Asia. The company was founded by Perry Brink and Fidelia Brink on May 5, 1859 and is headquartered in Richmond, VA.