Financial Contrast: Oshkosh (NYSE:OSK) and Deere & Company (NYSE:DE)

Deere & Company (NYSE:DE) and Oshkosh (NYSE:OSK) are both industrials companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, risk, earnings and institutional ownership.

Risk and Volatility

Deere & Company has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500. Comparatively, Oshkosh has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.

Insider and Institutional Ownership

68.6% of Deere & Company shares are held by institutional investors. Comparatively, 92.4% of Oshkosh shares are held by institutional investors. 0.3% of Deere & Company shares are held by insiders. Comparatively, 0.6% of Oshkosh 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.

Earnings and Valuation

This table compares Deere & Company and Oshkosh”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Deere & Company	$46.88 billion	3.94	$5.03 billion	$18.00	38.02
Oshkosh	$10.42 billion	0.85	$647.00 million	$8.74	16.38

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

Analyst Recommendations

This is a breakdown of recent recommendations for Deere & Company and Oshkosh, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Deere & Company	0	8	17	0	2.68
Oshkosh	0	6	11	0	2.65

Deere & Company currently has a consensus price target of $680.73, indicating a potential downside of 0.52%. Oshkosh has a consensus price target of $170.71, indicating a potential upside of 19.27%. Given Oshkosh’s higher possible upside, analysts plainly believe Oshkosh is more favorable than Deere & Company.

Profitability

This table compares Deere & Company and Oshkosh’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Deere & Company	10.16%	18.10%	4.60%
Oshkosh	5.24%	12.95%	5.86%

Dividends

Deere & Company pays an annual dividend of $6.48 per share and has a dividend yield of 0.9%. Oshkosh pays an annual dividend of $2.28 per share and has a dividend yield of 1.6%. Deere & Company pays out 36.0% of its earnings in the form of a dividend. Oshkosh pays out 26.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Deere & Company has increased its dividend for 4 consecutive years and Oshkosh has increased its dividend for 13 consecutive years. Oshkosh is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Deere & Company beats Oshkosh on 9 of the 17 factors compared between the two stocks.

About Deere & Company

Deere & Co. engages in the manufacture and distribution of equipment used in agriculture, construction, forestry, and turf care. It operates through the following segments: Agriculture and Turf, Construction and Forestry, and Financial Services. The Agriculture and Turf segment focuses on the distribution and manufacture of a full line of agriculture and turf equipment and related service parts. The Construction and Forestry segment offers machines and service parts used in construction, earthmoving, road building, material handling and timber harvesting. The Financial Services segment finances sales and leases by John Deere dealers of new and used agriculture and turf equipment and construction and forestry equipment. The company was founded by John Deere in 1837 and is headquartered in Moline, IL.

About Oshkosh

Oshkosh Corporation provides purpose-built vehicles and equipment worldwide. The company operates through three segments: Access, Defense, and Vocational segment. Its Access Equipment segment design and manufacture aerial work platform and telehandlers for use in construction, industrial, and maintenance applications; offers financing and leasing solutions including rental fleet loans, leases, and floor plan and retail financing; and towing and recovery equipment, which includes carriers, wreckers, and rotators, as well as provides equipment installation and sale of chassis and service parts. The Defense segment engages in the manufacture and sale of heavy, medium, and light tactical wheeled vehicles and related services for department of defense. Its Vocational segment offers custom and commercial firefighting equipment, fire apparatus, and emergency vehicles, including pumpers, aerial platform, ladder and tiller trucks, and tankers; light, medium, and heavy-duty rescue vehicles; and wildland rough terrain response, bomb squad, hazardous materials control vehicles, mobile command and control centers, and other emergency response vehicles. Additionally, this segment produces and sells custom and commercial firefighting vehicles, as well as command vehicles, ARFF vehicles; design and manufacture refuse collection vehicles for waste services industry; front discharge concrete mixers for the concrete ready-mix industry; and field service vehicles and truck-mounted cranes for construction, equipment dealer, building supply, utility, tire service, railroad, and mining industries. Further, the company provides its products through direct sales representatives, dealers, and distributors. Oshkosh Corporation was formerly known as Oshkosh Truck Corporation. The company was founded in 1917 and is headquartered in Oshkosh, Wisconsin.