Head to Head Survey: Welbilt (WBT) versus Tennant (TNC)

Welbilt (NYSE: WBT) and Tennant (NYSE:TNC) are both industrial products companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, analyst recommendations and earnings.

Institutional and Insider Ownership

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89.9% of Welbilt shares are held by institutional investors. Comparatively, 91.1% of Tennant shares are held by institutional investors. 0.4% of Welbilt shares are held by insiders. Comparatively, 5.6% of Tennant shares 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.

Valuation and Earnings

This table compares Welbilt and Tennant’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Welbilt $1.45 billion 1.85 $134.00 million $0.77 24.81
Tennant $1.00 billion 1.22 -$6.19 million $1.54 44.32

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

Profitability

This table compares Welbilt and Tennant’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Welbilt 9.27% 312.48% 5.88%
Tennant -0.62% 9.68% 3.24%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Welbilt and Tennant, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Welbilt 0 3 5 0 2.63
Tennant 0 0 1 0 3.00

Welbilt presently has a consensus price target of $23.40, indicating a potential upside of 22.51%. Given Welbilt’s higher possible upside, research analysts plainly believe Welbilt is more favorable than Tennant.

Volatility & Risk

Welbilt has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, Tennant has a beta of 0.86, meaning that its stock price is 14% less volatile than the S&P 500.

Dividends

Tennant pays an annual dividend of $0.84 per share and has a dividend yield of 1.2%. Welbilt does not pay a dividend. Tennant pays out 54.5% of its earnings in the form of a dividend. Tennant has increased its dividend for 46 consecutive years.

Summary

Welbilt beats Tennant on 10 of the 17 factors compared between the two stocks.

Welbilt Company Profile

Welbilt, Inc., formerly Manitowoc Foodservice, Inc., is a commercial foodservice equipment company. The Company designs, manufactures and supplies food and beverage equipment for the global commercial foodservice market, offering customers operator and patron insights, kitchen solutions, culinary expertise, and implementation support and service. It operates through three segments: Americas, EMEA and APAC. The Americas segment includes the United States, Canada and Latin America. The EMEA segment consists of markets in Europe, Middle East and Africa, including Russia and the commonwealth of independent states. The APAC segment consists of markets in China, Singapore, Australia, India, Malaysia, Indonesia, Thailand and the Philippines. It supplies foodservice equipment to commercial and institutional foodservice operators. Its brands include Cleveland, Convotherm, Delfield, fitKitchen, Frymaster, Garland, Kolpak, Lincoln, Manitowoc Ice, Merco, Merrychef and Multiplex.

Tennant Company Profile

Tennant Company designs, manufactures, and markets floor cleaning equipment. It offers a suite of products, including floor maintenance and outdoor cleaning equipment, detergent-free and other sustainable cleaning technologies, aftermarket parts and consumables, equipment maintenance and repair services, specialty surface coatings, and asset management solutions. The company also provides business solutions, such as financing, rental, and leasing programs, as well as machine-to-machine asset management solutions. Its products are used in retail establishments and distribution centers; factories and warehouses; and public venues, such as arenas and stadiums, office buildings, schools and universities, hospitals and clinics, parking lots and streets, and other environments. The company markets its products to contract cleaners, businesses, and various governmental entities through direct sales and service organization, as well as through a network of authorized distributors under the Tennant, Nobles, Green Machines, Alfa Uma Empresa Tennant, IRIS, Superior Anodes, Waterstar, and Orbio brands worldwide. Tennant Company was founded in 1870 and is headquartered in Minneapolis, Minnesota.

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