Head to Head Survey: ITT (NYSE:ITT) vs. IHI (OTCMKTS:IHICY)

IHI (OTCMKTS:IHICY) and ITT (NYSE:ITT) are both large-cap industrials companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, risk, earnings, profitability and institutional ownership.

Risk & Volatility

IHI has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500. Comparatively, ITT has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500.

Institutional & Insider Ownership

91.6% of ITT shares are owned by institutional investors. 0.9% of ITT shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings for IHI and ITT, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
IHI	0	1	0	0	2.00
ITT	0	1	8	0	2.89

ITT has a consensus price target of $260.22, suggesting a potential upside of 27.74%. Given ITT’s stronger consensus rating and higher possible upside, analysts plainly believe ITT is more favorable than IHI.

Profitability

This table compares IHI and ITT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
IHI	N/A	N/A	N/A
ITT	8.90%	15.90%	7.74%

Dividends

IHI pays an annual dividend of $0.07 per share and has a dividend yield of 0.5%. ITT pays an annual dividend of $1.54 per share and has a dividend yield of 0.8%. IHI pays out 6.8% of its earnings in the form of a dividend. ITT pays out 30.2% 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. ITT has raised its dividend for 10 consecutive years. ITT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares IHI and ITT”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
IHI	$10.92 billion	1.46	$1.06 billion	$1.03	14.31
ITT	$3.94 billion	4.62	$488.00 million	$5.10	39.94

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

Summary

ITT beats IHI on 14 of the 17 factors compared between the two stocks.

About IHI

IHI Corporation designs and builds engineering solutions in Japan and internationally. The company operates through four segments: Resources, Energy and Environment; Social Infrastructure; Industrial Systems and General-Purpose Machinery; and Aero Engine, Space and Defense. The company engages in the manufacturing, sale, and provision of services related to power systems plants for land use and power systems for chips; carbon solutions comprising boilers and storage facilities; components for nuclear power plants; bridges and water gates, transport systems, shield systems, and concrete construction materials; vehicular turbochargers, parking, heat treatment and surface engineering; transport machineries; logistics and industrial systems; and rotating machineries comprising compressors, separation systems, and turbochargers for ships. It also offers 3D laser radars, X-ray inspection systems, monitoring equipment, oil leak monitors, vibration control systems and seismic isolation floor systems, and disaster prevention equipment; environmental monitoring; cryogenic products, material handling systems, steelmaking equipment, pulp and paper machinery, agricultural machinery, life associated equipment; aero engines; rocket, space utilization, defense, and traffic control systems; and communication, electronic, electric measuring, information processing machines, and other instruments and equipment. In addition, the company sells and rents real estate. The company was formerly known as Ishikawajima-Harima Heavy Industries Co., Ltd and changed its name to IHI Corporation in 2007. IHI Corporation was founded in 1853 and is headquartered in Tokyo, Japan.

About ITT

ITT Inc., together with its subsidiaries, manufactures and sells engineered critical components and customized technology solutions for the transportation, industrial, and energy markets in the United States and internationally. The Motion Technologies segment manufactures brake pads, shims, shock absorbers, and energy absorption components; and sealing technologies primarily for the transportation industry, including passenger cars, trucks, light- and heavy-duty commercial and military vehicles, buses, and trains. This segment sells its products under ITT Friction Technologies, KONI, Wolverine Advanced Materials, Axtone, Novitek, and GALT. brand names. The Industrial Process segment provides industrial pumps, valves, and plant optimization and remote monitoring systems and services; and aftermarket solutions, such as replacement parts and services. It serves various customers in industries, such as chemical, energy, mining, and other industrial process markets. This segment sells its products under Goulds Pumps, Bornemann, Engineered Valves, PRO Services, C'treat, i-ALERT, Rheinhütte Pumpen, and Habonim brand names. The Connect & Control Technologies segment designs and manufactures a range of engineered connectors and specialized products for critical applications supporting various markets, including aerospace and defense, industrial, transportation, medical, and energy. This segment provides connector products, such as circular, rectangular, radio frequency, fiber optic, D-sub miniature, micro-miniature, and cable assemblies; and control products consist of highly engineered actuation, flow control, energy absorption, environmental control, and composite component solutions for the aerospace, defense, and industrial markets under Cannon, VEAM, BIW Connector Systems, Aerospace Controls, Enidine, Compact Automation, Neo-Dyn Process Controls, Conoflow, and Micro-Mode brand names. The company was incorporated in 1920 and is headquartered in Stamford, Connecticut.