Vertiv (NYSE:VRT) and Vestas Wind Systems AS (OTCMKTS:VWDRY) Head-To-Head Review

Vestas Wind Systems AS (OTCMKTS:VWDRY) and Vertiv (NYSE:VRT) are both large-cap industrials companies, but which is the better business? We will compare the two businesses based on the strength of their risk, profitability, earnings, dividends, institutional ownership, analyst recommendations and valuation.

Institutional and Insider Ownership

89.9% of Vertiv shares are held by institutional investors. 1.1% of Vertiv shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Vestas Wind Systems AS pays an annual dividend of $0.02 per share and has a dividend yield of 0.2%. Vertiv pays an annual dividend of $0.25 per share and has a dividend yield of 0.1%. Vestas Wind Systems AS pays out 4.7% of its earnings in the form of a dividend. Vertiv pays out 5.7% 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. Vertiv has raised its dividend for 2 consecutive years. Vestas Wind Systems AS is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Vestas Wind Systems AS has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500. Comparatively, Vertiv has a beta of 2.05, suggesting that its stock price is 105% more volatile than the S&P 500.

Profitability

This table compares Vestas Wind Systems AS and Vertiv’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vestas Wind Systems AS	5.42%	29.07%	4.22%
Vertiv	15.09%	50.47%	15.87%

Earnings and Valuation

This table compares Vestas Wind Systems AS and Vertiv”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vestas Wind Systems AS	$21.29 billion	1.29	$880.23 million	$0.43	21.47
Vertiv	$10.23 billion	7.32	$1.33 billion	$4.42	43.98

Vertiv has lower revenue, but higher earnings than Vestas Wind Systems AS. Vestas Wind Systems AS is trading at a lower price-to-earnings ratio than Vertiv, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Vestas Wind Systems AS and Vertiv, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vestas Wind Systems AS	1	1	1	4	3.14
Vertiv	1	5	22	2	2.83

Vertiv has a consensus price target of $335.67, suggesting a potential upside of 72.67%. Given Vertiv’s higher possible upside, analysts plainly believe Vertiv is more favorable than Vestas Wind Systems AS.

Summary

Vertiv beats Vestas Wind Systems AS on 13 of the 18 factors compared between the two stocks.

About Vestas Wind Systems AS

Vestas Wind Systems A/S engages in the design, manufacture, installation, and services of wind turbines the United States, Denmark, and internationally. It operates in two segments, Power Solutions and Service. The Power Solutions segment offers onshore and offshore wind power plants, wind turbines, development sites, etc. The Service segment engages in the sale of service contracts, spare parts, and related activities. Vestas Wind Systems A/S was founded in 1898 and is headquartered in Aarhus, Denmark.

About Vertiv

Vertiv Holdings Co, together with its subsidiaries, designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. It offers AC and DC power management products, switchgear and busbar products, thermal management products, integrated rack systems, modular solutions, and management systems for monitoring and controlling digital infrastructure that are integral to the technologies used for various services, including e-commerce, online banking, file sharing, video on-demand, energy storage, wireless communications, Internet of Things, and online gaming. The company also provides lifecycle management services, predictive analytics, and professional services for deploying, maintaining, and optimizing its products and their related systems; and preventative maintenance, acceptance testing, engineering and consulting, performance assessments, remote monitoring, training, spare parts, and digital critical infrastructure software services. It offers its products primarily under the Vertiv, Liebert, NetSure, Geist, E&I, Powerbar, and Avocent brands. The company serves cloud services, financial services, healthcare, transportation, manufacturing, energy, education, government, social media, and retail industries through a network of direct sales professionals, independent sales representatives, channel partners, and original equipment manufacturers. Vertiv Holdings Co is headquartered in Westerville, Ohio.