Analyzing Gentex (GNTX) & Sorl Auto Parts (SORL)

Sorl Auto Parts (NASDAQ:SORL) and Gentex (NASDAQ:GNTX) are both auto/tires/trucks companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, valuation, risk and analyst recommendations.

Profitability

This table compares Sorl Auto Parts and Gentex’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sorl Auto Parts 2.63% 11.20% 3.27%
Gentex 25.11% 21.83% 19.17%

Analyst Ratings

This is a summary of recent ratings and price targets for Sorl Auto Parts and Gentex, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sorl Auto Parts 0 0 0 0 N/A
Gentex 0 6 4 0 2.40

Gentex has a consensus target price of $24.38, indicating a potential upside of 10.95%. Given Gentex’s higher probable upside, analysts clearly believe Gentex is more favorable than Sorl Auto Parts.

Dividends

Gentex pays an annual dividend of $0.44 per share and has a dividend yield of 2.0%. Sorl Auto Parts does not pay a dividend. Gentex pays out 34.4% of its earnings in the form of a dividend. Gentex has increased its dividend for 8 consecutive years.

Insider & Institutional Ownership

6.3% of Sorl Auto Parts shares are held by institutional investors. Comparatively, 85.9% of Gentex shares are held by institutional investors. 58.9% of Sorl Auto Parts shares are held by company insiders. Comparatively, 0.6% of Gentex shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Sorl Auto Parts and Gentex’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sorl Auto Parts $390.52 million 0.13 $24.32 million $1.26 2.08
Gentex $1.79 billion 3.21 $406.79 million $1.28 17.16

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

Volatility & Risk

Sorl Auto Parts has a beta of 2.04, suggesting that its stock price is 104% more volatile than the S&P 500. Comparatively, Gentex has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500.

Summary

Gentex beats Sorl Auto Parts on 13 of the 16 factors compared between the two stocks.

About Sorl Auto Parts

SORL Auto Parts, Inc., together with its subsidiaries, develops, manufactures, and distributes automotive brake systems and other safety related auto parts to automotive original equipment manufacturers and the related aftermarket in the People's Republic of China. It operates through two segments, Commercial Vehicles Brake Systems and Passenger Vehicles Brake Systems. The company offers a range of products covering 65 categories and approximately 2000 specifications in automotive brake systems that are principally used in various types of commercial vehicles, such as trucks and buses. SORL Auto Parts, Inc. markets its products under the SORL brand through authorized distributors. The company exports its products to approximately 104 countries and regions. SORL Auto Parts, Inc. was founded in 2003 and is headquartered in Rui'an, the People's Republic of China.

About Gentex

Gentex Corporation provides automatic-dimming and non-dimming rearview mirrors, and electronics for the automotive industry; dimmable aircraft windows for the aviation industry; and commercial smoke alarms and signaling devices for the fire protection industry worldwide. It designs, develops, manufactures, and markets automotive products, including interior and exterior electrochromic automatic-dimming rearview mirrors, automotive electronics, and interior and exterior non-automatic-dimming rearview mirrors with electronic features for automotive passenger cars, light trucks, pick-up trucks, sport utility vehicles, and vans for original equipment manufacturers, tier one automotive mirror manufacturers, and various aftermarket and accessory customers. The company also provides photoelectric smoke detectors and alarms, audible and visual signaling alarms, electrochemical carbon monoxide detectors and alarms, and bells and speakers for use in fire detection systems in office buildings, hotels, and other commercial and residential establishments. Gentex Corporation sells its fire protection products directly, as well as through sales managers and manufacturer representative organizations to fire protection and security product distributors, electrical wholesale houses, and original equipment manufacturers of fire protection systems. The company was founded in 1974 and is headquartered in Zeeland, Michigan.

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