Critical Review: Douglas Dynamics (PLOW) and Its Rivals

Douglas Dynamics (NYSE:PLOW) is one of 436 publicly-traded companies in the “Machinery” industry, but how does it weigh in compared to its rivals? We will compare Douglas Dynamics to related companies based on the strength of its risk, analyst recommendations, dividends, institutional ownership, valuation, earnings and profitability.

Volatility and Risk

Douglas Dynamics has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500. Comparatively, Douglas Dynamics’ rivals have a beta of 5.10, meaning that their average share price is 410% more volatile than the S&P 500.

Dividends

Douglas Dynamics pays an annual dividend of $1.18 per share and has a dividend yield of 3.2%. Douglas Dynamics pays out 42.8% of its earnings in the form of a dividend. As a group, “Machinery” companies pay a dividend yield of 2.8% and pay out 24.5% of their earnings in the form of a dividend.

Profitability

This table compares Douglas Dynamics and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Douglas Dynamics	8.71%	22.97%	9.74%
Douglas Dynamics Competitors	-1,039.02%	-14.89%	0.52%

Valuation & Earnings

This table compares Douglas Dynamics and its rivals gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Douglas Dynamics	$656.05 million	$46.90 million	13.46
Douglas Dynamics Competitors	$4.66 billion	$364.17 million	15.80

Douglas Dynamics’ rivals have higher revenue and earnings than Douglas Dynamics. Douglas Dynamics is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of recent ratings for Douglas Dynamics and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Douglas Dynamics	0	2	2	1	2.80
Douglas Dynamics Competitors	4211	14724	18252	808	2.41

Douglas Dynamics presently has a consensus price target of $51.67, indicating a potential upside of 39.12%. As a group, “Machinery” companies have a potential upside of 29.50%. Given Douglas Dynamics’ stronger consensus rating and higher possible upside, research analysts clearly believe Douglas Dynamics is more favorable than its rivals.

Insider and Institutional Ownership

91.8% of Douglas Dynamics shares are owned by institutional investors. Comparatively, 51.8% of shares of all “Machinery” companies are owned by institutional investors. 1.5% of Douglas Dynamics shares are owned by company insiders. Comparatively, 14.3% of shares of all “Machinery” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Douglas Dynamics beats its rivals on 8 of the 15 factors compared.

Douglas Dynamics Company Profile

Douglas Dynamics, Inc. designs, manufactures and sells equipment and attachments for work trucks, with a primary focus on products used for snow and ice control. Its offerings include snowplows, spreaders and related equipment for commercial, municipal and government customers. The company serves the work-truck market through brands including WESTERN, FISHER and SnowEx. Its products are distributed through dealer networks, with service and support provided through those channels. Founded in 1948, Douglas Dynamics has expanded beyond snow and ice equipment into additional work-truck solutions, including truck bodies and related equipment.