Critical Analysis: Brother Industries (OTCMKTS:BRTHY) and Taitron Components (NASDAQ:TAIT)

Brother Industries (OTCMKTS:BRTHY) and Taitron Components (NASDAQ:TAIT) are both technology companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, risk, valuation, profitability, earnings, institutional ownership and dividends.

Earnings & Valuation

This table compares Brother Industries and Taitron Components”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brother Industries	$5.94 billion	1.27	$446.33 million	$3.84	15.68
Taitron Components	$3.54 million	3.63	$900,000.00	$0.07	30.57

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

Institutional & Insider Ownership

18.1% of Taitron Components shares are owned by institutional investors. 60.0% of Taitron Components shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Brother Industries and Taitron Components’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brother Industries	N/A	N/A	N/A
Taitron Components	-27.42%	-6.18%	-5.66%

Dividends

Brother Industries pays an annual dividend of $0.85 per share and has a dividend yield of 1.4%. Taitron Components pays an annual dividend of $0.16 per share and has a dividend yield of 7.5%. Brother Industries pays out 22.1% of its earnings in the form of a dividend. Taitron Components pays out 228.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk and Volatility

Brother Industries has a beta of 0.17, indicating that its share price is 83% less volatile than the S&P 500. Comparatively, Taitron Components has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Brother Industries and Taitron Components, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brother Industries	0	0	0	0	0.00
Taitron Components	1	0	0	0	1.00

Summary

Brother Industries beats Taitron Components on 8 of the 14 factors compared between the two stocks.

About Brother Industries

Brother Industries, Ltd. manufactures and sells communications and printing equipment in Japan, the Americas, Europe, Asia, Oceania, the Middle East, Africa, and internationally. It operates through Printing & Solutions, Machinery, Domino, Nissei, Personal & Home, and Network & Contents segments. The Printing & Solutions segment offers inkjet printers; all-in-one black-and-white and color laser printers; scanners; and labeling systems, and label and mobile printers. The Machinery segment offers industrial sewing machines, machine tools, and garment printers. The Domino segment offers coding and marking equipment, and digital printing equipment. The Nissei segment provides gearmotors, high stiffness reducers, and gears. The Personal & Home segment provides sewing and cutting machines, sewing and embroidery machines, and commercial embroidery machines. The Network & Contents segment provides online karaoke systems and applications for smartphones/tablets, as well as content, nursing care, and video viewing services; and manages karaoke clubs. The company was formerly known as Nippon Sewing Machine Manufacturing Co. and changed its name to Brother Industries, Ltd. in 1962. Brother Industries, Ltd. was founded in 1908 and is headquartered in Nagoya, Japan.

About Taitron Components

Taitron Components Incorporated engages in the supply of original designed and manufactured (ODM) electronic components, and distribution of brand name electronic components. It distributes discrete semiconductors, commodity integrated circuits, optoelectronic devices, and passive components. The company also offers value-added engineering and turn-key solutions focusing on providing contract electronic manufacturers (CEMs) and original equipment manufacturers (OEMs) with ODM products for their turn-key projects. It serves other electronic distributors, CEMs, and OEMs in the United States, South Korea, China, Taiwan, and internationally. The company has strategic allies with Teamforce Co. Ltd.; Grand Shine Management; and Zowie Technology Corporation. Taitron Components Incorporated was incorporated in 1989 and is headquartered in Valencia, California.