Comparing Timken (NYSE:TKR) and MSA Safety Incorporporated (NYSE:MSA)

Timken (NYSE:TKR) and MSA Safety Incorporporated (NYSE:MSA) are both mid-cap industrials companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, earnings, dividends and analyst recommendations.

Dividends

Timken pays an annual dividend of $1.44 per share and has a dividend yield of 1.4%. MSA Safety Incorporporated pays an annual dividend of $2.16 per share and has a dividend yield of 1.3%. Timken pays out 35.6% of its earnings in the form of a dividend. MSA Safety Incorporporated pays out 27.8% 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. Timken has raised its dividend for 12 consecutive years and MSA Safety Incorporporated has raised its dividend for 56 consecutive years.

Earnings & Valuation

This table compares Timken and MSA Safety Incorporporated”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Timken	$4.81 billion	1.45	$288.40 million	$4.04	25.26
MSA Safety Incorporporated	$2.01 billion	3.25	$278.92 million	$7.78	21.84

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Timken and MSA Safety Incorporporated, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Timken	0	3	7	0	2.70
MSA Safety Incorporporated	0	4	2	0	2.33

Timken currently has a consensus target price of $141.90, indicating a potential upside of 39.05%. MSA Safety Incorporporated has a consensus target price of $211.33, indicating a potential upside of 24.38%. Given Timken’s stronger consensus rating and higher possible upside, research analysts plainly believe Timken is more favorable than MSA Safety Incorporporated.

Insider and Institutional Ownership

89.1% of Timken shares are held by institutional investors. Comparatively, 92.5% of MSA Safety Incorporporated shares are held by institutional investors. 8.1% of Timken shares are held by company insiders. Comparatively, 0.7% of MSA Safety Incorporporated shares are held by company 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.

Risk and Volatility

Timken has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500. Comparatively, MSA Safety Incorporporated has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.

Profitability

This table compares Timken and MSA Safety Incorporporated’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Timken	5.88%	13.13%	6.52%
MSA Safety Incorporporated	15.03%	24.86%	12.53%

Summary

Timken beats MSA Safety Incorporporated on 9 of the 17 factors compared between the two stocks.

About Timken

The Timken Company designs, manufactures, and sells engineered bearings and industrial motion products, and related services in the United States and internationally. The company's Engineered Bearings segment provides various bearing products, including tapered, spherical, and cylindrical roller bearings; plain bearings, metal-polymer bearings, and rod end bearings; radial, angular, and precision ball bearings; thrust and specialty ball bearings; journal bearings; and housed or mounted bearings. This segment serves wind energy, agriculture, construction, food and beverage, metals and mining, automotive and truck, aerospace, rail, and other industries under the Timken, GGB, and Fafnir brands. Its Industrial Motion segment offers a portfolio of engineered products comprising industrial drives, automatic lubrication systems, linear motion products and systems, chains, belts, seals, couplings, filtration systems, and industrial clutches and brakes. It also provides industrial drivetrain and bearing repairing services. This segment serves a range of industries, such as solar energy, automation, construction, agriculture and turf, passenger rail, marine, aerospace, packaging and logistics, medical, and others under the Philadelphia Gear, Cone Drive, Rollon, Nadella, Groeneveld, BEKA, Diamond, Drives, Timken Belts, Spinea, Des-Case, Lagersmit, Lovejoy, and PT Tech brands. The Timken Company was founded in 1899 and is headquartered in North Canton, Ohio.

About MSA Safety Incorporporated

MSA Safety Incorporated develops, manufactures, and supplies safety products and technology solutions that protect people and facility infrastructures in the fire service, energy, utility, construction, and industrial manufacturing applications, as well as heating, ventilation, air conditioning, and refrigeration industries worldwide. The company's core product offerings include fixed gas and flame detection systems, such as gas detection monitoring systems, and flame detectors and open-path infrared gas detectors; breathing apparatus products, including self-contained breathing apparatus; hand-held portable gas detection instruments to detect the presence or absence of various gases in the air; industrial head protection products; firefighter helmets and protective apparel; and fall protection equipment, such as confined space equipment, harnesses, lanyards, and self-retracting lifelines, as well as engineered systems. In addition, the company offers air-purifying respirators, eye and face protection products, ballistic helmets, and gas masks. It serves distributors and end-users through indirect and direct sales channels. The company offers its products under the V-Gard, Cairns, and Gallet brand names. MSA Safety Incorporated was founded in 1914 and is based in Cranberry Township, Pennsylvania.