Critical Contrast: Ritchie Bros. Auctioneers (RBA) versus Its Competitors

Ritchie Bros. Auctioneers (NYSE: RBA) is one of 99 public companies in the “Business Support Services” industry, but how does it compare to its peers? We will compare Ritchie Bros. Auctioneers to similar businesses based on the strength of its profitability, analyst recommendations, valuation, risk, earnings, institutional ownership and dividends.

Analyst Ratings

This is a summary of recent ratings and price targets for Ritchie Bros. Auctioneers and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ritchie Bros. Auctioneers 2 5 4 0 2.18
Ritchie Bros. Auctioneers Competitors 626 1858 2605 62 2.41

Ritchie Bros. Auctioneers presently has a consensus target price of $30.67, suggesting a potential upside of 8.17%. As a group, “Business Support Services” companies have a potential downside of 6.60%. Given Ritchie Bros. Auctioneers’ higher possible upside, equities research analysts plainly believe Ritchie Bros. Auctioneers is more favorable than its peers.

Profitability

This table compares Ritchie Bros. Auctioneers and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ritchie Bros. Auctioneers 8.96% 14.72% 6.14%
Ritchie Bros. Auctioneers Competitors -53.45% -160.77% 0.27%

Dividends

Ritchie Bros. Auctioneers pays an annual dividend of $0.68 per share and has a dividend yield of 2.4%. Ritchie Bros. Auctioneers pays out 144.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Business Support Services” companies pay a dividend yield of 1.1% and pay out 28.3% of their earnings in the form of a dividend. Ritchie Bros. Auctioneers has increased its dividend for 14 consecutive years.

Volatility & Risk

Ritchie Bros. Auctioneers has a beta of 0.57, meaning that its stock price is 43% less volatile than the S&P 500. Comparatively, Ritchie Bros. Auctioneers’ peers have a beta of 1.13, meaning that their average stock price is 13% more volatile than the S&P 500.

Valuation and Earnings

This table compares Ritchie Bros. Auctioneers and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Ritchie Bros. Auctioneers $566.33 million $203.46 million 60.32
Ritchie Bros. Auctioneers Competitors $1.10 billion $177.92 million 23.24

Ritchie Bros. Auctioneers’ peers have higher revenue, but lower earnings than Ritchie Bros. Auctioneers. Ritchie Bros. Auctioneers is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Institutional and Insider Ownership

96.2% of Ritchie Bros. Auctioneers shares are held by institutional investors. Comparatively, 62.1% of shares of all “Business Support Services” companies are held by institutional investors. 0.4% of Ritchie Bros. Auctioneers shares are held by insiders. Comparatively, 12.7% of shares of all “Business Support Services” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Ritchie Bros. Auctioneers beats its peers on 8 of the 15 factors compared.

Ritchie Bros. Auctioneers Company Profile

Ritchie Bros Auctioneers Inc is a Canada-based holding company. The Company is an industrial auctioneer and used equipment distributor, selling used equipment and other assets. Its segments include Core Auction, which is a network of auction locations that conduct live, unreserved auctions with both on-site and online bidding, and Other, which includes its EquipmentOne and Mascus International Holding B.V. (Mascus) online services. EquipmentOne is an online marketplace that equipment sellers can navigate independently. EquipmentOne facilitates the completion of sales through a settlement process managed by EquipmentOne that protects both the seller and the buyer. Mascus is an online equipment listing service for used heavy machinery and trucks. It offers subscriptions to equipment dealers, brokers, exporters and equipment manufacturers to list equipment available for sale at a listed price. The Company, through Mascus, provides online advertising services, business tools and solutions.

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