ESAB (NYSE:ESAB) and Mayville Engineering (NYSE:MEC) Financial Analysis

Mayville Engineering (NYSE:MEC) and ESAB (NYSE:ESAB) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

Earnings & Valuation

This table compares Mayville Engineering and ESAB”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mayville Engineering	$546.49 million	0.77	-$8.11 million	($0.84)	-19.62
ESAB	$2.84 billion	1.53	$226.77 million	$2.79	25.10

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

Analyst Ratings

This is a breakdown of current ratings and target prices for Mayville Engineering and ESAB, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mayville Engineering	1	1	4	0	2.50
ESAB	0	1	7	0	2.88

Mayville Engineering presently has a consensus price target of $35.75, suggesting a potential upside of 116.88%. ESAB has a consensus price target of $135.57, suggesting a potential upside of 93.58%. Given Mayville Engineering’s higher possible upside, analysts clearly believe Mayville Engineering is more favorable than ESAB.

Insider & Institutional Ownership

45.4% of Mayville Engineering shares are held by institutional investors. Comparatively, 91.1% of ESAB shares are held by institutional investors. 5.6% of Mayville Engineering shares are held by insiders. Comparatively, 7.2% of ESAB shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Mayville Engineering and ESAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mayville Engineering	-2.95%	-6.63%	-2.99%
ESAB	5.75%	14.48%	5.99%

Risk and Volatility

Mayville Engineering has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500. Comparatively, ESAB has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500.

Summary

ESAB beats Mayville Engineering on 12 of the 14 factors compared between the two stocks.

About Mayville Engineering

Mayville Engineering Company, Inc., together with its subsidiaries, engages in the production, design, prototyping and tooling, fabrication, aluminum extrusion, coating, and assembling of aftermarket components in the United States. It also supplies engineered components to original equipment manufacturers. The company serves heavy and medium duty commercial vehicles, construction and access equipment, powersports, agriculture, military, and other end markets. Mayville Engineering Company, Inc. was founded in 1945 and is headquartered in Milwaukee, Wisconsin.

About ESAB

ESAB Corporation engages in the formulation, development, manufacture, and supply of consumable products and equipment for use in cutting, joining, automated welding, and gas control equipment. Its comprehensive range of welding consumables includes electrodes, cored and solid wires, and fluxes using a range of specialty and other materials; and cutting consumables comprising electrodes, nozzles, shields, and tips. The company's equipment ranges from portable welding machines to large customized automated cutting and welding systems. It also offers a range of software and digital solutions to help its customers increase their productivity, remotely monitor their welding operations, and digitize their documentation. The company sells its products under the ESAB brand to various end markets, such as general industry, infrastructure, renewable energy, medical and life sciences, transportation, construction, and energy. It offers its products through independent distributors and direct salespeople. The company operates in North America, South America, Europe, the Middle East, India, Africa, and the Asia Pacific. ESAB Corporation was founded in 1904 and is headquartered in North Bethesda, Maryland.