Analyzing Schaeffler (OTCMKTS:SCFLF) and Autoliv (NYSE:ALV)

Schaeffler (OTCMKTS:SCFLF) and Autoliv (NYSE:ALV) are both auto/tires/trucks companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Earnings and Valuation

This table compares Schaeffler and Autoliv”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Schaeffler	$19.68 billion	0.04	-$683.89 million	($1.31)	-3.66
Autoliv	$10.82 billion	0.80	$735.00 million	$9.30	12.50

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Schaeffler and Autoliv, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Schaeffler	0	0	1	0	3.00
Autoliv	0	5	8	0	2.62

Autoliv has a consensus target price of $135.27, indicating a potential upside of 16.32%. Given Autoliv’s higher probable upside, analysts plainly believe Autoliv is more favorable than Schaeffler.

Volatility & Risk

Schaeffler has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500. Comparatively, Autoliv has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500.

Profitability

This table compares Schaeffler and Autoliv’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Schaeffler	-4.73%	-10.43%	-1.77%
Autoliv	6.45%	29.03%	8.75%

Insider and Institutional Ownership

69.6% of Autoliv shares are held by institutional investors. 0.3% of Autoliv shares are held by company 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

Autoliv beats Schaeffler on 12 of the 14 factors compared between the two stocks.

About Schaeffler

Schaeffler AG, together with its subsidiaries, develops, manufactures, and sells components and system for industrial applications in Europe, the Americas, China, and the Asia Pacific. The Automotive Technologies division offers mechanical, mechatronic, and electronic components and systems for powertrain electrification used in passenger cars and commercial vehicles, such as electric motors, axle transmissions, axle drives, power electronics, hybrid modules, electromechanical and hydraulic actuators, and thermal management module; torque converters, hybrid dampers, clutches, variable valve train systems, valve-lash adjustment elements, balancer shafts, camshaft phasing systems, timing drives, and front end auxillary drives. This division provides rolling bearing application and products, such as wheel, ball, and needle roller bearings; and mechanical components and mechatronic systems for steering and other chassis applications, including Space Drive, a steer-by-wire system. The Automotive Aftermarket division offers components and repair solutions for light commercial vehicles, trucks and buses, and offroad sectors under the LuK, INA, and FAG brand names, as well as service for repair shops under the REPXPERT brand. The Industrial division develops and manufactures rotary and linear bearing solutions, drive technology components and systems, and service solutions, such as sensor-based condition monitoring systems. This division serves customers in the wind, raw materials, aerospace, rail, offroad, two wheelers, power transmission, and industrial automation sectors. The company was formerly known as INA Beteiligungsgesellschaft mit beschränkter Haftung and changed its name to Schaeffler AG in October 2014. The company was founded in 1946 and is headquartered in Herzogenaurach, Germany. Schaeffler AG is a subsidiary of IHO Verwaltungs GmbH.

About Autoliv

Autoliv, Inc., through its subsidiaries, develops, manufactures, and supplies passive safety systems to the automotive industry in Europe, the Americas, China, Japan, and rest of Asia. It offers passive safety systems, including modules and components for frontal-impact airbag protection systems, side-impact airbag protection systems, seatbelts, steering wheels, and inflator technologies. The company also provides mobility safety solutions, such as pedestrian protection, battery cut-off switches, connected safety services, and safety solutions for riders of powered two wheelers. It primarily serves car manufacturers. Autoliv, Inc. was founded in 1953 and is headquartered in Stockholm, Sweden.