Superior Industries International (NYSE: SUP) and Magna International (NYSE:MGA) are both auto/tires/trucks companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, earnings, profitability and risk.
Institutional and Insider Ownership
84.2% of Superior Industries International shares are owned by institutional investors. Comparatively, 59.7% of Magna International shares are owned by institutional investors. 1.5% of Superior Industries International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This table compares Superior Industries International and Magna International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Superior Industries International||0.66%||7.96%||3.32%|
This is a breakdown of current recommendations for Superior Industries International and Magna International, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Superior Industries International||0||1||3||0||2.75|
Superior Industries International presently has a consensus price target of $23.75, suggesting a potential upside of 36.10%. Magna International has a consensus price target of $61.83, suggesting a potential upside of 6.10%. Given Superior Industries International’s stronger consensus rating and higher possible upside, research analysts plainly believe Superior Industries International is more favorable than Magna International.
Risk and Volatility
Superior Industries International has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500. Comparatively, Magna International has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500.
Superior Industries International pays an annual dividend of $0.36 per share and has a dividend yield of 2.1%. Magna International pays an annual dividend of $1.10 per share and has a dividend yield of 1.9%. Superior Industries International pays out -180.0% of its earnings in the form of a dividend. Magna International pays out 19.6% 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. Superior Industries International has increased its dividend for 6 consecutive years. Superior Industries International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
This table compares Superior Industries International and Magna International’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Superior Industries International||$732.70 million||0.59||$41.38 million||($0.20)||-87.25|
|Magna International||$36.45 billion||0.58||$2.03 billion||$5.61||10.39|
Magna International has higher revenue and earnings than Superior Industries International. Superior Industries International is trading at a lower price-to-earnings ratio than Magna International, indicating that it is currently the more affordable of the two stocks.
Magna International beats Superior Industries International on 10 of the 18 factors compared between the two stocks.
About Superior Industries International
Superior Industries International, Inc. is engaged in the design and manufacture of aluminum wheels for sale to original equipment manufacturers (OEMs). The Company supplies cast aluminum wheels to automobile and light truck manufacturers, with wheel manufacturing operations in the United States and Mexico. The Company offers wheels in a range of finishes, which include Bright Machined, Polished Face with Painted Window, Fully Painted, Premium Paint, Polished, Chrome Clad and Mirror Finish Ultra Bright Machining. The Company’s products, which are manufactured in its North American facilities, are delivered primarily to automotive assembly operations in North America for global OEMs. Its OEM aluminum wheels are primarily sold for factory installation, as either optional or standard equipment, on various vehicle models. As of December 31, 2015, the Company operated five manufacturing facilities in the United States and Mexico.
About Magna International
Magna International Inc. (Magna) is a global automotive supplier. The Company’s segments are North America, Europe, Asia, Rest of World, and Corporate and Other. The Company’s product capabilities include producing body, chassis, exterior, seating, powertrain, electronic, active driver assistance, vision, closure, and roof systems and modules, as well as vehicle engineering and contract manufacturing. The Company has over 320 manufacturing operations and approximately 100 product development, engineering and sales centers in over 30 countries. It provides a range of body, chassis and engineering solutions to its original equipment manufacturer (OEM) customers. It has capabilities in powertrain design, development, testing and manufacturing. It offers bumper fascia systems, exterior trim and modular systems. It offers exterior and interior mirror systems. It offers sealing, trim, engineered glass and module systems. It offers softtops, retractable hardtops, modular tops and hardtops.
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