Financial Analysis: Anixter (AXE) and EnerSys (ENS)

Anixter (NYSE: AXE) and EnerSys (NYSE:ENS) are both mid-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, risk, valuation, earnings, analyst recommendations, profitability and dividends.

Profitability

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This table compares Anixter and EnerSys’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Anixter 1.38% 12.39% 4.18%
EnerSys 3.94% 18.02% 8.49%

Volatility & Risk

Anixter has a beta of 2.04, meaning that its stock price is 104% more volatile than the S&P 500. Comparatively, EnerSys has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500.

Dividends

EnerSys pays an annual dividend of $0.70 per share and has a dividend yield of 1.0%. Anixter does not pay a dividend. EnerSys pays out 14.7% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current ratings and target prices for Anixter and EnerSys, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Anixter 0 2 1 0 2.33
EnerSys 0 1 2 0 2.67

Anixter currently has a consensus price target of $88.00, indicating a potential upside of 12.75%. EnerSys has a consensus price target of $78.00, indicating a potential upside of 10.81%. Given Anixter’s higher probable upside, equities analysts clearly believe Anixter is more favorable than EnerSys.

Valuation and Earnings

This table compares Anixter and EnerSys’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Anixter $7.93 billion 0.33 $109.00 million $5.16 15.13
EnerSys $2.37 billion 1.25 $160.21 million $4.75 14.82

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

Institutional and Insider Ownership

92.6% of Anixter shares are owned by institutional investors. Comparatively, 97.2% of EnerSys shares are owned by institutional investors. 14.7% of Anixter shares are owned by insiders. Comparatively, 1.4% of EnerSys shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

EnerSys beats Anixter on 9 of the 16 factors compared between the two stocks.

Anixter Company Profile

Anixter International Inc., through its subsidiary, Anixter Inc., distributes enterprise cabling and security solutions, electrical and electronic wire and cable products, and utility power solutions. Its Network & Security Solutions segment offers copper and fiber optic cable and connectivity, access control, video surveillance, intrusion and fire/life safety, cabinet, power, cable management, wireless, professional audio/video, voice and networking switche, and other ancillary products for technology, finance, telecommunications service provider, transportation, education, government, healthcare, and retail industries. The company's Electrical & Electronic Solutions segment provides electrical and electronic wires and cables, shipboard cables, support and supply products, low-voltage and instrumentation cables, industrial communication and control products, security cables, connectors, industrial Ethernet switches, and voice and data cables to the commercial and industrial, and original equipment manufacturer markets. Its Utility Power Solutions segment supplies electrical transmission and distribution products, power plant maintenance, repair and operations supplies, and smart-grid products, as well as arranges materials management and procurement outsourcing for the power generation and electricity distribution industries. The company serves contractors, installers, system integrators, value-added resellers, architects, engineers, and wholesale distributors in the manufacturing, resource extraction, Internet service provider, and utility industries, as well as defense customers. It distributes its products primarily in North America, Europe, the Middle East, Africa, the Asia Pacific, and Central and Latin America. The company was formerly known as Itel Corporation. Anixter International Inc. was founded in 1957 and is headquartered in Glenview, Illinois.

EnerSys Company Profile

EnerSys manufactures, markets, and distributes industrial batteries. The company offers chargers, outdoor cabinet enclosures, power equipment, and battery accessories, as well as related after-market and customer-support services for industrial batteries. It also provides reserve power products that are used for backup power for the continuous operation of critical applications in telecommunications systems, uninterruptible power systems applications for computer and computer-controlled systems, and other specialty power applications, including medical and security systems, premium starting, lighting, and ignition applications, as well as in switchgear, electrical control systems used in electric utilities, large-scale energy storage, energy pipelines, commercial aircraft, satellites, military aircraft, submarines, ships, and tactical vehicles. The company's reserve power products also include thermally managed cabinets and enclosures for electronic equipment and batteries. In addition, the company offers motive power products that are used to provide power for electric industrial forklifts used in manufacturing, warehousing, and other material handling applications, as well as mining equipment, diesel locomotive starting, and other rail equipment. It sells its products through a network of distributors, independent representatives, and internal sales forces in North and South America, Europe, the Middle East, and Africa, as well as Asia, Australia, and Oceania. The company was formerly known as Yuasa, Inc. and changed its name to EnerSys in January 2001 to reflect its focus on the energy systems business. EnerSys was founded in 1999 and is headquartered in Reading, Pennsylvania.

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