Hillenbrand (NYSE: HI) and SANDVIK AB/ADR (OTCMKTS:SDVKY) are both consumer staples companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.
Volatility and Risk
Hillenbrand has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, SANDVIK AB/ADR has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.
Hillenbrand pays an annual dividend of $0.83 per share and has a dividend yield of 1.8%. SANDVIK AB/ADR pays an annual dividend of $0.35 per share and has a dividend yield of 2.1%. Hillenbrand pays out 39.3% of its earnings in the form of a dividend. SANDVIK AB/ADR pays out 37.2% 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. Hillenbrand has raised its dividend for 10 consecutive years. SANDVIK AB/ADR is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares Hillenbrand and SANDVIK AB/ADR’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares Hillenbrand and SANDVIK AB/ADR’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Hillenbrand||$1.59 billion||1.83||$126.20 million||$2.11||22.09|
|SANDVIK AB/ADR||$10.66 billion||1.99||$1.55 billion||$0.94||18.01|
SANDVIK AB/ADR has higher revenue and earnings than Hillenbrand. SANDVIK AB/ADR is trading at a lower price-to-earnings ratio than Hillenbrand, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
77.1% of Hillenbrand shares are owned by institutional investors. Comparatively, 0.1% of SANDVIK AB/ADR shares are owned by institutional investors. 1.8% of Hillenbrand shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
This is a breakdown of current ratings and target prices for Hillenbrand and SANDVIK AB/ADR, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Hillenbrand presently has a consensus target price of $53.00, suggesting a potential upside of 13.73%. Given Hillenbrand’s higher probable upside, equities analysts plainly believe Hillenbrand is more favorable than SANDVIK AB/ADR.
SANDVIK AB/ADR beats Hillenbrand on 9 of the 17 factors compared between the two stocks.
Hillenbrand Company Profile
Hillenbrand, Inc. operates as a diversified industrial company worldwide. The company operates in two segments, Process Equipment Group and Batesville. The Process Equipment Group segment designs, engineers, manufactures, markets, and services process and material handling equipment and systems for various industries, including plastics, food and pharmaceuticals, chemicals, fertilizers, minerals and mining, energy, wastewater treatment, and forest products. It provides compounding equipment comprising twin screw compounding and extrusion machines under the Coperion brand; and material handling equipment, such as pneumatic and hydraulic conveying equipment, high-precision feeders, and blenders, as well as rotary, diverter, and slide gate valves under the Coperion and Coperion K-Tron brand names. This segment also offers size reduction equipment under the Pennsylvania Crusher, Gundlach, and Jeffrey Rader brands; screening and separating equipment under the Rotex brand name; piston and piston diaphragm pump technology under the ABEL brand; pinch and duckbill check valves under the Red Valve, Tideflex Technologies, and RKL Controls brand names; and replacement parts and services. In addition, it sells equipment and systems to customers directly, as well as through a network of independent sales representatives and distributors. The Batesville segment designs, manufactures, distributes, and sells funeral services products and solutions, such as burial caskets; cremation caskets, and urns; selection room display fixtures for funeral homes; personalization and memorialization products and services; and Web-based applications consisting of funeral planning, Website products, and back office software for licensed funeral homes to licensed funeral professionals operating licensed funeral establishments. This segment develops and markets operational management software solutions for cemeteries. The company was founded in 2007 and is headquartered in Batesville, Indiana.
SANDVIK AB/ADR Company Profile
Sandvik AB (publ) operates as an engineering company in the areas of mining and rock excavation, metal-cutting, and materials technology worldwide. The company offers metal-cutting tools and tooling systems, including boring, drilling, milling, reaming, and turning tools, as well as tailor made tools and inserts and tooling systems; and mining and rock excavation equipment and tools, such as stationary and mobile crushers and screens, underground drill rigs and bolters, surface drill rigs, exploration drill rigs and tools, underground loaders and trucks, mechanical cutting equipment, rock tools, rock drills, mining automation systems, bulk materials handling equipment, conveyor components, and parts and services, as well as breakers, demolition tools, and booms. It also provides stainless steels, special alloys, and titanium products comprising bar and hollow bars, controlled expansion alloy products, billets and blooms, hot isostatic pressed products, metal powders, plates and sheets, strip steels, and welding and wire products, as well as tubes, pipes, fittings, and flanges. In addition, it offers diffusion furnaces, and furnace products and heating materials; cemented carbide components, and diamond and cubic boron nitride in mesh and polycrystalline forms; and steel belts and processing systems. The company serves aerospace, automotive, construction, consumer goods, general engineering, nuclear power generation, oil and gas, process, and renewable energy industries. Sandvik AB (publ) was founded in 1862 and is headquartered in Stockholm, Sweden.
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