Head to Head Survey: Holley (NYSE:HLLY) vs. Allison Transmission (NYSE:ALSN)

Holley (NYSE:HLLY) and Allison Transmission (NYSE:ALSN) are both auto/tires/trucks companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, risk, earnings, valuation and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Holley and Allison Transmission, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Holley	0	1	8	0	2.89
Allison Transmission	1	4	1	0	2.00

Holley presently has a consensus target price of $7.75, suggesting a potential upside of 93.75%. Allison Transmission has a consensus target price of $71.71, suggesting a potential downside of 3.73%. Given Holley’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Holley is more favorable than Allison Transmission.

Profitability

This table compares Holley and Allison Transmission’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Holley	2.91%	5.77%	2.04%
Allison Transmission	21.80%	58.05%	13.56%

Valuation & Earnings

This table compares Holley and Allison Transmission’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Holley	$659.70 million	0.72	$19.18 million	$0.17	23.53
Allison Transmission	$3.04 billion	2.15	$673.00 million	$7.49	9.95

Allison Transmission has higher revenue and earnings than Holley. Allison Transmission is trading at a lower price-to-earnings ratio than Holley, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

39.7% of Holley shares are held by institutional investors. Comparatively, 96.9% of Allison Transmission shares are held by institutional investors. 0.9% of Holley shares are held by company insiders. Comparatively, 1.1% of Allison Transmission shares are held 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.

Risk and Volatility

Holley has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500. Comparatively, Allison Transmission has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.

Summary

Allison Transmission beats Holley on 9 of the 14 factors compared between the two stocks.

About Holley

Holley Inc. operates as designer, manufacturer, and marketer of automotive aftermarket products for car and truck enthusiasts in the United States, Canada, Europe, and China. Its products span various automotive platforms and sells across multiple channels. The company's performance automotive products include carburetors, fuel pumps, fuel injection systems, nitrous oxide injection systems, superchargers, exhaust headers, mufflers, distributors, ignition components, engine tuners, automotive performance plumbing products; and exhaust products, as well as shifters, converters, transmission kits, transmissions, tuners, and automotive software. It also offers brakes and brake systems, vehicle restoration parts, helmets, head and neck restraints, seat belts, fire suits, and electronic control and monitoring systems. The company sells its products under the Holley, Holley EFI, MSD, Simpson, Powerteq, Accel, and Flowmaster through DTC, E-tailer, warehouse distributor, traditional retailer, and jobber/ installer channels. Holley Inc. was founded in 1903 and is headquartered in Bowling Green, Kentucky.

About Allison Transmission

Allison Transmission Holdings, Inc., together with its subsidiaries, designs, manufactures, and sells fully automatic transmissions for medium- and heavy-duty commercial vehicles and medium- and heavy-tactical U.S. defense vehicles, and electrified propulsion systems worldwide. It provides commercial-duty on-highway, off-highway and defense fully automatic transmissions, and electric hybrid and fully electric systems. The company offers transmissions for various applications, including distribution, refuse, construction, fire, and emergency on-highway trucks; school and transit buses; motor homes; energy, mining, and construction off-highway vehicles and equipment; and wheeled and tracked defense vehicles. It provides its transmissions and electric propulsion solutions under the Allison Transmission brand name; and remanufactured transmissions under the ReTran brand name. The company also sells branded replacement parts, support equipment, aluminum die cast components, and other products necessary to service the installed base of vehicles utilizing its solutions, as well as defense kits, engineering services, and extended transmission coverage services to various original equipment manufacturers, distributors, and the U.S. government. It serves customers through an independent network of approximately 1,600 independent distributor and dealer locations. The company was formerly known as Clutch Holdings, Inc. Allison Transmission Holdings, Inc. was founded in 1915 and is headquartered in Indianapolis, Indiana.