Eaton Corporation, PLC (NYSE: ETN) and Aixtron Se (NASDAQ:AIXG) are both industrial products companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitabiliy, risk, institutional ownership, valuation, dividends and analyst recommendations.

Dividends

Eaton Corporation, PLC pays an annual dividend of $2.40 per share and has a dividend yield of 3.0%. Aixtron Se does not pay a dividend. Eaton Corporation, PLC pays out 55.8% of its earnings in the form of a dividend. Aixtron Se has raised its dividend for 7 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings for Eaton Corporation, PLC and Aixtron Se, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eaton Corporation, PLC 1 10 7 0 2.33
Aixtron Se 0 1 1 0 2.50

Eaton Corporation, PLC presently has a consensus price target of $76.46, suggesting a potential downside of 4.90%. Given Eaton Corporation, PLC’s higher probable upside, equities analysts plainly believe Eaton Corporation, PLC is more favorable than Aixtron Se.

Profitability

This table compares Eaton Corporation, PLC and Aixtron Se’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Eaton Corporation, PLC 9.86% 12.82% 6.33%
Aixtron Se -25.16% -14.89% -12.50%

Valuation and Earnings

This table compares Eaton Corporation, PLC and Aixtron Se’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Eaton Corporation, PLC $19.78 billion 1.82 $3.21 billion $4.30 18.70
Aixtron Se N/A N/A N/A ($0.31) -9.87

Eaton Corporation, PLC has higher revenue and earnings than Aixtron Se. Aixtron Se is trading at a lower price-to-earnings ratio than Eaton Corporation, PLC, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Eaton Corporation, PLC has a beta of 1.35, meaning that its stock price is 35% more volatile than the S&P 500. Comparatively, Aixtron Se has a beta of 1.54, meaning that its stock price is 54% more volatile than the S&P 500.

Insider and Institutional Ownership

76.3% of Eaton Corporation, PLC shares are held by institutional investors. Comparatively, 0.4% of Aixtron Se shares are held by institutional investors. 0.8% of Eaton Corporation, PLC shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Eaton Corporation, PLC beats Aixtron Se on 10 of the 14 factors compared between the two stocks.

Eaton Corporation, PLC Company Profile

Eaton Corporation (Eaton) is a diversified power management company. It is engaged in the manufacturing of electrical components and systems for power quality, distribution and control; hydraulics components, systems and services for industrial and mobile equipment; aerospace fuel, hydraulics and pneumatic systems for commercial and military use, and truck and automotive drivetrain and powertrain systems for performance, fuel economy and safety. On January 1, 2011, it closed the acquisition of the Tuthill Coupling Group, which is a division of the Tuthill Corporation. It has five segments: Electrical Americas and Electrical Rest of World; Hydraulics; Aerospace; Truck, and Automotive. On October 1, 2010, it acquired CopperLogic, Inc. On July 15, 2010, it acquired EMC Engineers, Inc. In May 2011, it acquired Internormen Technology Group. In August 2011, it acquired IE Power, Inc. In December 2011, it acquired E.A. Pedersen Company.

Aixtron Se Company Profile

AIXTRON SE is a provider of deposition equipment to the semiconductor industry. The Company’s technology solutions are used by a range of customers across the world to build components for electronic and opto-electronic applications based on compound, silicon or organic semiconductor materials. Such components are used in fiber optic communication systems, wireless and mobile telephony applications, optical and electronic storage devices, computing, signaling and lighting, displays, as well as a range of other technologies. The Company’s business activities include developing, producing and installing equipment for the deposition of semiconductor and other complex materials, process engineering, consulting and training, including ongoing customer support and after-sales service. The Company supplies its customers with both production-scale material deposition systems and small scale systems for research and development (R&D) or small scale production.

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