Analyzing Fenix Parts (FENX) & Horizon Global (NYSE:HZN)

Horizon Global (NYSE: HZN) and Fenix Parts (OTCMKTS:FENX) are both small-cap auto/tires/trucks companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Insider & Institutional Ownership

91.0% of Horizon Global shares are held by institutional investors. Comparatively, 4.1% of Fenix Parts shares are held by institutional investors. 1.3% of Horizon Global shares are held by insiders. Comparatively, 16.6% of Fenix Parts shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Horizon Global and Fenix Parts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Horizon Global -0.56% 16.58% 3.01%
Fenix Parts N/A N/A N/A

Risk and Volatility

Horizon Global has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500. Comparatively, Fenix Parts has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500.

Earnings & Valuation

This table compares Horizon Global and Fenix Parts’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Horizon Global $649.20 million 0.31 -$12.36 million ($0.42) -19.48
Fenix Parts $132.10 million 0.07 -$42.86 million ($2.03) -0.24

Horizon Global has higher revenue and earnings than Fenix Parts. Horizon Global is trading at a lower price-to-earnings ratio than Fenix Parts, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and target prices for Horizon Global and Fenix Parts, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Horizon Global 0 3 3 0 2.50
Fenix Parts 0 0 0 0 N/A

Horizon Global currently has a consensus price target of $17.00, indicating a potential upside of 107.82%. Given Horizon Global’s higher probable upside, analysts plainly believe Horizon Global is more favorable than Fenix Parts.

Summary

Horizon Global beats Fenix Parts on 9 of the 12 factors compared between the two stocks.

About Horizon Global

Horizon Global Corporation is a designer, manufacturer and distributor of a range of custom-engineered towing, trailering, cargo management and other products serving the automotive aftermarket, retail and original equipment (OE) channels. The Company operates through three segments: Horizon Americas, Horizon Asia-Pacific, and Horizon Europe-Africa. Its towing product category includes devices and accessories installed on a tow-vehicle for the purpose of attaching a trailer and camper, among others, such as hitches and other towing accessories. Its trailering product category includes control devices and components of the trailer itself, such as brake controls and brake replacement parts. Its cargo management product category includes a range of products used to facilitate the transportation of various forms of cargo, to secure that cargo or to organize items. Its other product category includes a range of items, such as tubular push bars, side steps, and commercial brooms and brushes.

About Fenix Parts

Fenix Parts, Inc. is engaged in auto recycling business. The Company recovers and resells original equipment manufacturer (OEM) parts, components and systems, such as engines, transmissions, radiators, trunks, lamps and seats reclaimed from damaged, totaled or low value vehicles. The Company operates through Automobile Recycling segment. The Company purchases its vehicles primarily at auto salvage auctions. Upon receipt of vehicles, the Company inventories and then dismantles the vehicles and sells the recycled components. Its customers include collision repair shops (body shops), mechanical repair shops, auto dealerships and individual retail customers. The Company also generates a portion of its revenue from the sale as scrap of the unusable parts and materials, from the sale of used cars and motorcycles, the sale of aftermarket parts, and from the sale of extended warranty contracts.

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