Analyzing Douglas Dynamics (PLOW) & Allison Transmission Holdings (ALSN)
Douglas Dynamics (NYSE: PLOW) and Allison Transmission Holdings (NYSE:ALSN) are both auto/tires/trucks companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, analyst recommendations, earnings and valuation.
Douglas Dynamics pays an annual dividend of $0.96 per share and has a dividend yield of 2.8%. Allison Transmission Holdings pays an annual dividend of $0.60 per share and has a dividend yield of 1.6%. Douglas Dynamics pays out 76.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Allison Transmission Holdings pays out 33.7% of its earnings in the form of a dividend. Douglas Dynamics has raised its dividend for 4 consecutive years and Allison Transmission Holdings has raised its dividend for 4 consecutive years.
Institutional and Insider Ownership
85.2% of Douglas Dynamics shares are owned by institutional investors. 3.2% of Douglas Dynamics shares are owned by insiders. Comparatively, 7.9% of Allison Transmission Holdings shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Douglas Dynamics and Allison Transmission Holdings’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Douglas Dynamics||$465.33 million||1.66||$86.94 million||$1.26||27.06|
|Allison Transmission Holdings||$1.98 billion||2.79||$707.40 million||$1.78||20.89|
Allison Transmission Holdings has higher revenue and earnings than Douglas Dynamics. Allison Transmission Holdings is trading at a lower price-to-earnings ratio than Douglas Dynamics, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and target prices for Douglas Dynamics and Allison Transmission Holdings, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Allison Transmission Holdings||1||5||5||1||2.50|
Douglas Dynamics currently has a consensus target price of $42.00, indicating a potential upside of 23.17%. Allison Transmission Holdings has a consensus target price of $41.43, indicating a potential upside of 11.43%. Given Douglas Dynamics’ stronger consensus rating and higher possible upside, equities analysts clearly believe Douglas Dynamics is more favorable than Allison Transmission Holdings.
Volatility & Risk
Douglas Dynamics has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500. Comparatively, Allison Transmission Holdings has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.
This table compares Douglas Dynamics and Allison Transmission Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Allison Transmission Holdings||14.32%||31.27%||6.77%|
Allison Transmission Holdings beats Douglas Dynamics on 12 of the 17 factors compared between the two stocks.
Douglas Dynamics Company Profile
Douglas Dynamics, Inc. is a manufacturer and up-fitter of commercial vehicle attachments and equipment. The Company’s portfolio includes snow and ice management attachments sold under the BLIZZARD, FISHER, HENDERSON, SNOWEX and WESTERN brands, turf care equipment under the TURFEX brand and industrial maintenance equipment under the SWEEPEX brand. The Company operates through two segments: Work Truck Attachments and Work Truck Solutions. The Work Truck Attachments segment includes snow and ice management attachments sold under the FISHER, WESTERN, HENDERSON and SNOWEX brands. The Work Truck Solutions segment includes the up-fit of attachments and storage solutions for commercial work vehicles under the DEJANA brand and its related sub-brands. In its Work Truck Attachments segment, the Company offers a product line of snowplows, and sand and salt spreaders for light and heavy duty trucks. Its Work Truck Solutions products consist of truck and vehicle up-fits.
Allison Transmission Holdings Company Profile
Allison Transmission Holdings, Inc. and its subsidiaries design and manufacture commercial and defense fully-automatic transmissions. The Company manufactures fully-automatic transmissions for medium- and heavy-duty commercial vehicles, and medium-and heavy-tactical United States defense vehicles. The Company’s transmissions are used in a range of applications, including on-highway trucks (distribution, refuse, construction, fire and emergency), buses (primarily school, transit and hybrid-transit), motorhomes, off-highway vehicles and equipment (energy, mining and construction) and defense vehicles (wheeled and tracked). The Company’s transmissions are sold under the Allison Transmission brand name and remanufactured transmissions are sold under the ReTran brand name. The Company has developed over 100 different models that were used in more than 2,500 different vehicle configurations and were compatible with over 500 combinations of engines, as of December 31, 2016.
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