Head to Head Contrast: Hyster-Yale (NYSE:HY) & Donaldson (NYSE:DCI)

Hyster-Yale (NYSE:HY) and Donaldson (NYSE:DCI) are both industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, earnings and analyst recommendations.

Dividends

Hyster-Yale pays an annual dividend of $1.46 per share and has a dividend yield of 4.8%. Donaldson pays an annual dividend of $1.28 per share and has a dividend yield of 1.5%. Hyster-Yale pays out -22.3% of its earnings in the form of a dividend. Donaldson pays out 33.2% 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. Hyster-Yale has raised its dividend for 1 consecutive years and Donaldson has raised its dividend for 38 consecutive years. Hyster-Yale is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Hyster-Yale and Donaldson’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hyster-Yale	-3.33%	-21.03%	-4.87%
Donaldson	11.68%	28.68%	14.27%

Analyst Recommendations

This is a summary of recent ratings and target prices for Hyster-Yale and Donaldson, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hyster-Yale	1	1	2	0	2.25
Donaldson	0	2	3	0	2.60

Hyster-Yale presently has a consensus target price of $47.50, suggesting a potential upside of 56.83%. Donaldson has a consensus target price of $101.67, suggesting a potential upside of 15.89%. Given Hyster-Yale’s higher possible upside, research analysts plainly believe Hyster-Yale is more favorable than Donaldson.

Volatility and Risk

Hyster-Yale has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500. Comparatively, Donaldson has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500.

Institutional & Insider Ownership

46.5% of Hyster-Yale shares are owned by institutional investors. Comparatively, 82.8% of Donaldson shares are owned by institutional investors. 37.8% of Hyster-Yale shares are owned by company insiders. Comparatively, 2.2% of Donaldson shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Hyster-Yale and Donaldson”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hyster-Yale	$3.77 billion	0.14	-$60.10 million	($6.56)	-4.62
Donaldson	$3.89 billion	2.61	$453.80 million	$3.85	22.79

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

Summary

Donaldson beats Hyster-Yale on 11 of the 16 factors compared between the two stocks.

About Hyster-Yale

Hyster-Yale, Inc., through its subsidiaries, designs, engineers, manufactures, sells, and services a line of lift trucks, attachments, and aftermarket parts worldwide. The company manufactures components, such as frames, masts, and transmissions; and assembles lift trucks. It markets its products primarily under the Hyster and Yale brand names to independent Hyster and Yale retail dealerships. The company also sells aftermarket parts under the Hyster and Yale, as well as UNISOURCE and PREMIER brands to Hyster and Yale dealers for the service of competitor lift trucks. In addition, it produces and distributes attachments, forks, and lift tables under the Bolzoni, Auramo, and Meyer brand names; and designs and produces products in the port equipment and rough terrain forklift markets. Further, the company designs, manufactures, and sells hydrogen fuel-cell stacks and engines. It serves light and heavy manufacturers, trucking and automotive companies, rental companies, building materials and paper suppliers, lumber, metal products, warehouses, retailers, food distributors, container handling companies, and U.S. and non-U.S. governmental agencies. The company was formerly known as Hyster-Yale Materials Handling, Inc. and changed its name to Hyster-Yale, Inc. in June 2024. Hyster-Yale, Inc. was incorporated in 1991 and is headquartered in Cleveland, Ohio.

About Donaldson

Donaldson Company, Inc. manufactures and sells filtration systems and replacement parts worldwide. The company operates through three segments: Mobile Solutions, Industrial Solutions, and Life Sciences. Its Mobile Solutions segment provides replacement filters for air and liquid filtration applications, such as air filtration systems; liquid filtration systems for fuel, lube, and hydraulic applications; exhaust and emissions systems and sensors; indicators; and monitoring systems. This segment sells its products to original equipment manufacturers (OEMs) in the construction, mining, agriculture, aerospace, defense, and transportation markets; and to independent distributors, and OEM dealer networks. The company's Industrial Solutions segment offers dust, fume, and mist collectors; compressed air and industrial gasses purification systems; and hydraulic and lubricated rotating equipment applications, as well as gas and liquid filtration for industrial processes. This segment sells its products to various distributors, OEMs, and end-users. Its Life Sciences segment provides micro-environment gas and liquid filtration for food, beverage, and industrial processes; bioprocessing equipment, that includes bioreactors and fermenters; and bioprocessing consumables, such as chromatography devices, reagents and filters, and polytetrafluoroethylene membrane-based products, as well as specialized air and gas filtration systems for applications, including hard disk drives, semi-conductor manufacturing and sensors, battery systems, and powertrain components to OEMs and various end-users. The company was founded in 1915 and is headquartered in Bloomington, Minnesota.