Metso Oyj (OTCMKTS: MXCYY) and Caterpillar (NYSE:CAT) are both industrial products companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.
Institutional & Insider Ownership
0.0% of Metso Oyj shares are owned by institutional investors. Comparatively, 69.2% of Caterpillar shares are owned by institutional investors. 1.0% of Metso Oyj shares are owned by company insiders. Comparatively, 0.1% of Caterpillar shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
This is a summary of recent ratings and recommmendations for Metso Oyj and Caterpillar, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Caterpillar has a consensus target price of $170.89, suggesting a potential upside of 18.44%. Given Caterpillar’s stronger consensus rating and higher possible upside, analysts clearly believe Caterpillar is more favorable than Metso Oyj.
This table compares Metso Oyj and Caterpillar’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Metso Oyj pays an annual dividend of $0.18 per share and has a dividend yield of 2.4%. Caterpillar pays an annual dividend of $3.12 per share and has a dividend yield of 2.2%. Metso Oyj pays out 94.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Caterpillar pays out 247.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Metso Oyj has raised its dividend for 8 consecutive years. Metso Oyj is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Metso Oyj and Caterpillar’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Metso Oyj||$3.06 billion||1.45||$115.22 million||$0.19||38.69|
|Caterpillar||$45.46 billion||1.90||$754.00 million||$1.26||114.52|
Caterpillar has higher revenue and earnings than Metso Oyj. Metso Oyj is trading at a lower price-to-earnings ratio than Caterpillar, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Metso Oyj has a beta of 1.45, suggesting that its stock price is 45% more volatile than the S&P 500. Comparatively, Caterpillar has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.
Caterpillar beats Metso Oyj on 11 of the 17 factors compared between the two stocks.
About Metso Oyj
Metso Oyj is a global supplier of technology and services for mining, aggregates, oil and gas, pulp, paper, as well as process industries. The Company’s segments include Minerals, Flow Control, and Group Head Office and other. The Minerals segment covers the Company’s mining, aggregates and recycling businesses. The Flow Control segment covers the Company’s valves and pumps businesses. The Company operates in Europe, North America, South and Central America, Other Asia-Pacific, China, and Africa and Middle East regions. The Company offers its products at over 190 locations in approximately 50 countries. The Company offers a range of products in categories, including wear parts, spare parts, lokotrack mobile plants, crushers, feeders, screens, conveyors, grinding, separation, pyro processing, bulk materials handling and slurry pumps. Its services include field services, life cycle services for mining, repairs and refurbishment, chamber optimization and engineered upgrades.
Caterpillar Inc. is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The Company operates through segments, including Construction Industries, which is engaged in supporting customers using machinery in infrastructure, forestry and building construction; Resource Industries, which is engaged in supporting customers using machinery in mining, quarry, waste and material handling applications; Energy & Transportation, which supports customers in oil and gas, power generation, marine, rail and industrial applications, including Cat machines; Financial Products segment, which provides financing and related services, and All Other operating segments, which includes activities, such as product management and development, and manufacturing of filters and fluids, undercarriage, tires and rims, ground engaging tools, fluid transfer products, and sealing and connecting components for Cat products.
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