Meritor (NYSE:MTOR) and Regency Affiliates (OTCMKTS:RAFI) are both small-cap auto/tires/trucks companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.
Risk & Volatility
Meritor has a beta of 2.22, indicating that its share price is 122% more volatile than the S&P 500. Comparatively, Regency Affiliates has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500.
95.2% of Meritor shares are held by institutional investors. 2.8% of Meritor shares are held by insiders. Comparatively, 0.0% of Regency Affiliates shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Regency Affiliates pays an annual dividend of $0.26 per share and has a dividend yield of 3.7%. Meritor does not pay a dividend.
This is a breakdown of current ratings and price targets for Meritor and Regency Affiliates, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Meritor currently has a consensus price target of $25.57, suggesting a potential upside of 19.21%. Given Meritor’s higher probable upside, research analysts clearly believe Meritor is more favorable than Regency Affiliates.
This table compares Meritor and Regency Affiliates’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Meritor and Regency Affiliates’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Meritor||$4.18 billion||0.42||$117.00 million||$3.03||7.08|
Meritor has higher revenue and earnings than Regency Affiliates.
Meritor beats Regency Affiliates on 9 of the 10 factors compared between the two stocks.
Meritor Company Profile
Meritor, Inc. designs, develops, manufactures, markets, distributes, sells, services, and supports integrated systems, modules, and components to original equipment manufacturers (OEMs) and the aftermarket for the commercial vehicle, transportation, and industrial sectors. It operates through two segments, Commercial Truck; and Aftermarket, Industrial and Trailer. The Commercial Truck segment supplies drivetrain systems and components, including axles, drivelines, and braking and suspension systems primarily for medium-and heavy-duty trucks and other applications; and undercarriage products and systems for trailer applications. The Aftermarket, Industrial and Trailer segment supplies axles, brakes, drivelines, suspension parts, and other replacement parts to commercial vehicle and industrial aftermarket customers. It also supplies drivetrain systems and various components, such as axles, drivelines, brakes, and suspension systems for military, construction, bus and coach, fire and emergency, and other applications. The company sells its products under the Meritor, Euclid, Trucktechnic, and Mach brands primarily to OEMs and its parts marketing operations, and dealers, as well as for other independent distributors and service garages in the aftermarket industry in North America, South America, Europe, and the Asia Pacific. The company was formerly known as ArvinMeritor, Inc. and changed its name to Meritor, Inc. in March 2011. Meritor, Inc. was founded in 1921 and is headquartered in Troy, Michigan.
Regency Affiliates Company Profile
Regency Affiliates, Inc., through its interest in MESC Capital, LLC, owns an on-site energy facility that supplies approximately 61 megawatts of steam and electricity to a Kimberly-Clark tissue mill in Mobile, Alabama. It also owns and operates 34.3 acres of land and rental property of approximately 717,000 square feet comprising a 2-story office building and a connected 6-story office tower in Woodlawn, Maryland through a limited partnership interest. The company is based in New York, New York.
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