Tower International (NYSE:TOWR) and Dongfeng Motor Group (OTCMKTS:DNFGY) are both auto/tires/trucks companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, analyst recommendations, earnings, valuation and risk.
This table compares Tower International and Dongfeng Motor Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Dongfeng Motor Group||N/A||N/A||N/A|
This table compares Tower International and Dongfeng Motor Group’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Tower International||$1.99 billion||0.27||$47.62 million||$3.76||6.88|
|Dongfeng Motor Group||$18.50 billion||0.14||$2.08 billion||$12.08||3.66|
Dongfeng Motor Group has higher revenue and earnings than Tower International. Dongfeng Motor Group is trading at a lower price-to-earnings ratio than Tower International, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Tower International and Dongfeng Motor Group, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Dongfeng Motor Group||0||0||0||0||N/A|
Tower International currently has a consensus price target of $31.67, indicating a potential upside of 22.36%. Given Tower International’s higher probable upside, research analysts clearly believe Tower International is more favorable than Dongfeng Motor Group.
Volatility & Risk
Tower International has a beta of 2.09, indicating that its stock price is 109% more volatile than the S&P 500. Comparatively, Dongfeng Motor Group has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500.
Tower International pays an annual dividend of $0.52 per share and has a dividend yield of 2.0%. Dongfeng Motor Group pays an annual dividend of $1.22 per share and has a dividend yield of 2.8%. Tower International pays out 13.8% of its earnings in the form of a dividend. Dongfeng Motor Group pays out 10.1% 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. Tower International has increased its dividend for 2 consecutive years. Dongfeng Motor Group is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider and Institutional Ownership
91.3% of Tower International shares are held by institutional investors. Comparatively, 0.1% of Dongfeng Motor Group shares are held by institutional investors. 6.2% of Tower International shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Tower International beats Dongfeng Motor Group on 10 of the 15 factors compared between the two stocks.
About Tower International
Tower International, Inc. manufactures and sells engineered automotive structural metal components and assemblies primarily for original equipment manufacturers. It operates in two segments, North America and Europe. The company provides body structures and assemblies, including structural metal components, which comprise body pillars, roof rails, and side sills; and Class A surfaces and assemblies that consist of body sides, hoods, doors, fenders, and pickup truck boxes. It also offers lower vehicle frames and structures, such as pickup truck and sport utility vehicle (SUV) full frames, automotive engine and rear suspension cradles, floor pan components, and cross members. In addition, the company offers complex body-in-white assemblies comprising various components and sub-assemblies. Its products have applications in small and large cars, crossovers, pickups, and SUVs. The company was formerly known as Tower Automotive, LLC and changed its name to Tower International, Inc. in October 2010. Tower International, Inc. was founded in 1993 and is headquartered in Livonia, Michigan.
About Dongfeng Motor Group
Dongfeng Motor Group Company Limited manufactures and sells commercial vehicles, passenger vehicles, and auto engines and parts in the People's Republic of China. The company operates through four segments: Commercial Vehicles, Passenger Vehicles, Financing Service, and Corporate and Others. It provides commercial vehicles, including trucks and buses; passenger vehicles comprising basic passenger cars, MPVs, and SUVs; and electric vehicles, off-road vehicles, and special commercial vehicles. The company also engages in other automotive-related businesses, including the manufacture of vehicle manufacturing equipment; import/export businesses; and finance, insurance agency, and used car businesses. In addition, it is involved in the marketing and sale of automobiles; and key assembly other automotive-related businesses. The company was founded in 1969 and is based in Wuhan, the People's Republic of China. Dongfeng Motor Group Company Limited is a subsidiary of Dongfeng Motor Corporation.
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