Financial Analysis: nVent Electric (NYSE:NVT) and Stoneridge (NYSE:SRI)

Stoneridge (NYSE:SRI) and nVent Electric (NYSE:NVT) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, profitability, dividends, risk, valuation, analyst recommendations and institutional ownership.

Valuation & Earnings

This table compares Stoneridge and nVent Electric”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stoneridge	$908.29 million	0.23	-$16.52 million	($1.16)	-6.47
nVent Electric	$3.89 billion	4.40	$710.20 million	$4.30	24.66

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

Risk & Volatility

Stoneridge has a beta of 1.45, indicating that its share price is 45% more volatile than the S&P 500. Comparatively, nVent Electric has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Stoneridge and nVent Electric, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stoneridge	1	0	1	0	2.00
nVent Electric	0	2	10	0	2.83

Stoneridge presently has a consensus target price of $16.00, suggesting a potential upside of 113.33%. nVent Electric has a consensus target price of $129.00, suggesting a potential upside of 21.67%. Given Stoneridge’s higher possible upside, equities analysts clearly believe Stoneridge is more favorable than nVent Electric.

Profitability

This table compares Stoneridge and nVent Electric’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stoneridge	-3.66%	-8.78%	-3.48%
nVent Electric	18.25%	15.18%	8.12%

Insider and Institutional Ownership

98.1% of Stoneridge shares are held by institutional investors. Comparatively, 90.1% of nVent Electric shares are held by institutional investors. 2.9% of Stoneridge shares are held by company insiders. Comparatively, 2.5% of nVent Electric shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

nVent Electric beats Stoneridge on 10 of the 14 factors compared between the two stocks.

About Stoneridge

Stoneridge, Inc., together with its subsidiaries, designs and manufactures engineered electrical and electronic systems, components, and modules for the automotive, commercial, off-highway, motorcycle, and agricultural vehicle markets in North America, South America, Europe, and internationally. The company operates through three segments: Control Devices, Electronics, and Stoneridge Brazil. The Control Devices segment offers actuators, sensors, switches, actuators, and connectors that monitor, measure, or activate specific functions within a vehicle. The Electronics segment designs and manufactures driver information systems, vision and safety systems, connectivity and compliance products, and electronic control units. Its products collect, store, and display vehicle information, such as speed, pressure, maintenance data, trip information, operator performance, temperature, distance traveled, and driver messages related to vehicle performance. This segment also offers electronic control units that regulate, coordinate, monitor, and direct the operation of the electrical system within a vehicle. The Stoneridge Brazil segment designs, manufactures, and sells vehicle tracking devices and monitoring services; vehicle security alarms and convenience accessories, including parking sensors and rearview cameras; in-vehicle audio and infotainment devices; and driver information systems and telematics solutions. The company provides its products and systems to various original equipment manufacturers and tier 1 customers, as well as aftermarket distributors. Stoneridge, Inc. was founded in 1965 and is headquartered in Novi, Michigan.

About nVent Electric

nVent Electric plc, together with its subsidiaries, designs, manufactures, markets, installs, and services electrical connection and protection solutions in North America, Europe, the Middle East, Africa, the Asia Pacific, and internationally. The company operates through three segments: Enclosures, Electrical & Fastening Solutions, and Thermal Management. The Enclosures segment provides solutions to protect electronics and data in mission critical applications, including data solutions. This segment also offers digital and automation solutions, system integrations, and global services. The Electrical & Fastening Solutions segment provides solutions that connect and protect power and data infrastructure. This segment also offers power connections, fastening solutions, cable management solutions, grounding and bonding systems, and tools and test instruments. The Thermal Management segment offers heat management solutions that protect people and assets. This segment includes heat tracing for freeze protection and process temperature maintenance and control; pipe freeze protection, surface deicing, hot water temperature maintenance, floor heating, fire-rated wiring, and leak detection; and heat trace systems, connected controls, remote monitoring, and annual service programs. The company markets its products through electrical distributors, contractors, and original equipment manufacturers under the CADDY, ERICO, GARDNER BENDER, HOFFMAN, ILSCO, RAYCHEM, SCHROFF, and TRACER brand names. Its products are used for various applications, such as industrial, commercial and residential, infrastructure, and energy. nVent Electric plc was founded in 1903 and is based in London, the United Kingdom.