Comparing AB SKF (OTCMKTS:SKFRY) and Mueller Industries (NYSE:MLI)

Mueller Industries (NYSE:MLI) and AB SKF (OTCMKTS:SKFRY) are both large-cap industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Mueller Industries and AB SKF, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mueller Industries	0	0	2	0	3.00
AB SKF	0	1	0	1	3.00

Mueller Industries currently has a consensus target price of $105.00, suggesting a potential upside of 1.96%. Given Mueller Industries’ higher probable upside, research analysts plainly believe Mueller Industries is more favorable than AB SKF.

Volatility and Risk

Mueller Industries has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500. Comparatively, AB SKF has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Earnings & Valuation

This table compares Mueller Industries and AB SKF”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mueller Industries	$3.77 billion	3.03	$604.88 million	$6.70	15.37
AB SKF	$9.34 billion	1.30	$612.44 million	$1.13	23.53

AB SKF has higher revenue and earnings than Mueller Industries. Mueller Industries is trading at a lower price-to-earnings ratio than AB SKF, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

94.5% of Mueller Industries shares are held by institutional investors. Comparatively, 0.1% of AB SKF shares are held by institutional investors. 2.7% of Mueller Industries shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Mueller Industries pays an annual dividend of $1.00 per share and has a dividend yield of 1.0%. AB SKF pays an annual dividend of $0.73 per share and has a dividend yield of 2.7%. Mueller Industries pays out 14.9% of its earnings in the form of a dividend. AB SKF pays out 64.6% 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. Mueller Industries has raised its dividend for 5 consecutive years.

Profitability

This table compares Mueller Industries and AB SKF’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mueller Industries	18.10%	25.02%	21.04%
AB SKF	5.54%	14.26%	7.30%

Summary

Mueller Industries beats AB SKF on 11 of the 17 factors compared between the two stocks.

About Mueller Industries

Mueller Industries, Inc. manufactures and sells copper, brass, aluminum, and plastic products in the United States, the United Kingdom, Canada, South Korea, the Middle East, China, and Mexico. It operates through three segments: Piping Systems, Industrial Metals, and Climate. The Piping Systems segment offers copper tubes, fittings, line sets, and pipe nipples. It also resells steel pipes, brass and plastic plumbing valves, malleable iron fittings and faucets, and plumbing specialties; and supplies water tubes. This segment sells its products to wholesalers in the plumbing and refrigeration markets, distributors to the manufactured housing and recreational vehicle industries, building material retailers, and air-conditioning original equipment manufacturers (OEMs). The Industrial Metals segment manufactures brass, bronze, and copper alloy rods; plumbing brass, valves, fittings, and gas assemblies; cold-form aluminum and copper products; machining of aluminum, steel, brass, and cast iron impacts and castings; brass and aluminum forgings; brass, aluminum, and stainless-steel valves; fluid control solutions; and gas train assembles to OEMs in the industrial, construction, HVAC, plumbing, and refrigeration markets. The Climate segment offers valves, protection devices, and brass fittings for various OEMs in the commercial HVAC and refrigeration markets; high-pressure components and accessories for the air-conditioning and refrigeration markets; coaxial heat exchangers and twisted tubes for the HVAC, geothermal, refrigeration, swimming pool heat pump, marine, ice machine, commercial boiler, and heat reclamation markets; and insulated HVAC flexible duct systems. Mueller Industries, Inc. was founded in 1917 and is headquartered in Collierville, Tennessee.

About AB SKF

AB SKF (publ) designs, manufactures, and sells bearings and units, seals, lubrication systems, condition monitoring, and services worldwide. It operates in two segments, Industrial and Automotive. The company offers rolling, mounted and housings, super-precision, slewing, plain, magnetic, and thin section bearings; industrial and automotive seals; lubricants, manual lubrication tools, lubricators, automatic lubrication systems, and lubrication system components; maintenance products, such as hydraulic, mechanical, and alignment tools, as well as heaters; belts, pulleys, chains, sprockets, bushings and hubs, couplings, and bolts and tightening systems; condition monitoring systems; test and measuring equipment, such as waviness and roundness analyzers, noise and vibration testers, and grease test rigs, as well as calibration with traceability, machine training and support, and upgrades and refurbishment services; and vehicle aftermarket products. It also provides application engineering services consisting of technical consultancy, numerical simulation and design, and root cause analysis; asset management services, such as assessment and benchmarking, maintenance strategy review, spare parts and inventory management, and lubrication management; condition-based maintenance, including vibration analysis and diagnostics, thermography, lubrication analysis, and condition monitoring system installation; mechanical maintenance comprising mounting and dismounting, precision alignment, and balancing; remanufacturing and customization; and training solutions, which include instructor-led training, e-learning courses, and webinar recordings. The company serves the aerospace, agriculture, automotive, construction, food and beverage, general machinery, machine tools, marine, material handling, metals, mining, mineral processing, ocean energy, pulp and paper, railways, and wind industries. AB SKF (publ) was incorporated in 1907 and is headquartered in Gothenburg, Sweden.