Financial Survey: Douglas Dynamics (PLOW) and Hyster-Yale Materials Handling (HY)

Douglas Dynamics (NYSE: PLOW) and Hyster-Yale Materials Handling (NYSE:HY) are both small-cap auto/tires/trucks companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, earnings, analyst recommendations, risk and profitability.

Dividends

Douglas Dynamics pays an annual dividend of $0.96 per share and has a dividend yield of 2.3%. Hyster-Yale Materials Handling pays an annual dividend of $1.21 per share and has a dividend yield of 1.5%. 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. Hyster-Yale Materials Handling pays out 33.8% of its earnings in the form of a dividend. Douglas Dynamics has increased its dividend for 4 consecutive years and Hyster-Yale Materials Handling has increased its dividend for 4 consecutive years.

Valuation & Earnings

This table compares Douglas Dynamics and Hyster-Yale Materials Handling’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Douglas Dynamics $465.33 million 2.04 $86.94 million $1.26 33.33
Hyster-Yale Materials Handling $2.72 billion 0.37 $101.90 million $3.58 22.48

Hyster-Yale Materials Handling has higher revenue and earnings than Douglas Dynamics. Hyster-Yale Materials Handling is trading at a lower price-to-earnings ratio than Douglas Dynamics, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Douglas Dynamics and Hyster-Yale Materials Handling, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Douglas Dynamics 0 0 2 0 3.00
Hyster-Yale Materials Handling 0 2 1 0 2.33

Douglas Dynamics presently has a consensus target price of $42.00, suggesting a potential upside of 0.00%. Hyster-Yale Materials Handling has a consensus target price of $74.00, suggesting a potential downside of 8.04%. Given Douglas Dynamics’ stronger consensus rating and higher probable upside, research analysts plainly believe Douglas Dynamics is more favorable than Hyster-Yale Materials Handling.

Institutional & Insider Ownership

89.2% of Douglas Dynamics shares are held by institutional investors. Comparatively, 51.6% of Hyster-Yale Materials Handling shares are held by institutional investors. 3.2% of Douglas Dynamics shares are held by company insiders. Comparatively, 26.3% of Hyster-Yale Materials Handling shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Douglas Dynamics has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500. Comparatively, Hyster-Yale Materials Handling has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500.

Profitability

This table compares Douglas Dynamics and Hyster-Yale Materials Handling’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Douglas Dynamics 6.16% 14.96% 4.82%
Hyster-Yale Materials Handling 2.17% 11.73% 4.33%

Summary

Douglas Dynamics beats Hyster-Yale Materials Handling on 11 of the 16 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.

Hyster-Yale Materials Handling Company Profile

Hyster-Yale Materials Handling, Inc. is a lift truck manufacturer. The Company designs, engineers, manufactures, sells and services a line of lift trucks, attachments and aftermarket parts marketed globally under the Hyster and Yale brand names, mainly to independent Hyster and Yale retail dealerships. The Company operates through five segments: the Americas, EMEA, JAPIC, Bolzoni and Nuvera. The Company offers a range of solutions, including attachments and hydrogen fuel cell power products, telematics, automation and fleet management services, as well as an array of other power options for its lift trucks. The Company’s segments for the lift truck business include three management units: the Americas, EMEA and JAPIC. Americas includes operations in the United States, Canada, Mexico, Brazil, Latin America and its corporate headquarters. EMEA includes operations in Europe, the Middle East and Africa. JAPIC includes operations in the Asia and Pacific regions including China.

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