Contrasting Hurco Companies (NASDAQ:HURC) & Fanuc (OTCMKTS:FANUY)

Hurco Companies (NASDAQ:HURC) and Fanuc (OTCMKTS:FANUY) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Dividends

Hurco Companies pays an annual dividend of $0.64 per share and has a dividend yield of 3.1%. Fanuc pays an annual dividend of $0.21 per share and has a dividend yield of 1.1%. Hurco Companies pays out -62.1% of its earnings in the form of a dividend. Fanuc pays out 33.9% 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. Hurco Companies is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Hurco Companies has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500. Comparatively, Fanuc has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Hurco Companies and Fanuc, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hurco Companies	1	0	0	0	1.00
Fanuc	0	2	0	1	2.67

Insider and Institutional Ownership

74.4% of Hurco Companies shares are held by institutional investors. Comparatively, 1.5% of Fanuc shares are held by institutional investors. 9.9% of Hurco Companies shares are held by 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.

Valuation & Earnings

This table compares Hurco Companies and Fanuc”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hurco Companies	$183.24 million	0.74	-$15.12 million	($1.03)	-20.19
Fanuc	$5.70 billion	6.60	$1.10 billion	$0.62	30.87

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

Profitability

This table compares Hurco Companies and Fanuc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hurco Companies	-3.58%	-3.37%	-2.51%
Fanuc	20.11%	9.60%	8.65%

Summary

Fanuc beats Hurco Companies on 11 of the 15 factors compared between the two stocks.

About Hurco Companies

Hurco Companies, Inc., an industrial technology company, designs, manufactures, and sells computerized machine tools to companies in the metal cutting industry worldwide. Its principal products include general-purpose computerized machine tools, including vertical and horizontal machining centers, turning centers, and toolroom machines. The company also provides computer control systems and related software for press brake applications. In addition, it offers machine tool components, automation integration equipment, and solutions for job shops; and software options, control upgrades, and accessories and replacement parts for its products, as well as customer service, training, and applications support services. Further, the company provides Autobend computer control systems for press brake machines. It serves independent job shops and specialized short-run production applications within large manufacturing operations, as well as precision tool, die, and mold manufacturers in aerospace, defense, medical equipment, energy, automotive/transportation, electronics, and computer industries. The company sells its products under the Hurco, Milltronics, and Takumi brands through independent agents and distributors, as well as through its direct sales and service organizations. Hurco Companies, Inc. was incorporated in 1968 and is headquartered in Indianapolis, Indiana.

About Fanuc

FANUC Corporation provides factory automation products in Japan, the Americas, Europe, China, the rest of Asia, and internationally. The company offers CNC series products, servo motors, lasers, robots, compact machining centers, electric injection molding machines, wire electrical discharge machines, and ultra-precision machines. It also provides FANUC intelligent edge link and drive system, an open platform for the manufacturing industry. FANUC Corporation was incorporated in 1950 and is headquartered in Yamanashi, Japan.