Twin Disc (NASDAQ:TWIN – Get Free Report) and Atlas Copco (OTCMKTS:ATLKY – Get Free Report) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, dividends, risk and institutional ownership.
Profitability
This table compares Twin Disc and Atlas Copco’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Twin Disc | 7.32% | 2.77% | 1.29% |
| Atlas Copco | 15.66% | 23.81% | 12.91% |
Analyst Recommendations
This is a breakdown of current ratings and target prices for Twin Disc and Atlas Copco, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Twin Disc | 0 | 1 | 2 | 0 | 2.67 |
| Atlas Copco | 2 | 3 | 4 | 1 | 2.40 |
Dividends
Twin Disc pays an annual dividend of $0.16 per share and has a dividend yield of 0.7%. Atlas Copco pays an annual dividend of $0.35 per share and has a dividend yield of 1.7%. Twin Disc pays out 8.7% of its earnings in the form of a dividend. Atlas Copco pays out 62.5% 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.
Institutional and Insider Ownership
65.2% of Twin Disc shares are held by institutional investors. Comparatively, 0.0% of Atlas Copco shares are held by institutional investors. 22.1% of Twin Disc shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
This table compares Twin Disc and Atlas Copco”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Twin Disc | $340.74 million | 0.96 | -$1.89 million | $1.84 | 12.28 |
| Atlas Copco | $17.21 billion | 5.75 | $2.70 billion | $0.56 | 36.27 |
Atlas Copco has higher revenue and earnings than Twin Disc. Twin Disc is trading at a lower price-to-earnings ratio than Atlas Copco, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Twin Disc has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500. Comparatively, Atlas Copco has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500.
Summary
Atlas Copco beats Twin Disc on 11 of the 17 factors compared between the two stocks.
About Twin Disc
Twin Disc, Incorporated engages in the design, manufacture, and sale of marine and heavy duty off-highway power transmission equipment in the United States, the Netherlands, China, Australia, Italy, and internationally. The company operates in two segments, Manufacturing and Distribution. Its principal products include marine transmissions, azimuth drives, surface drives, propellers, and boat management systems, as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches, and controls systems. The company also provides third-party manufactured products. It sells its products through a direct sales force and distributor network to customers primarily in the pleasure craft, commercial marine, patrol, and military marine markets, as well as in the energy and natural resources, government, agriculture, recycling, construction, oil and gas, and industrial markets. The company was incorporated in 1918 and is headquartered in Milwaukee, Wisconsin.
About Atlas Copco
Atlas Copco AB provides compressed air and gas, vacuum, energy, dewatering and industrial pump, industrial power tool, and assembly and machine vision solutions in North America, South America, Europe, Africa, the Middle East, Asia, and Oceania. It operates through Compressor Technique, Vacuum Technique, Industrial Technique, and Power Technique segments. The company offers piston compressors, oil-free tooth and scroll compressors, rotary screw compressors, oil-free blowers, oil-free centrifugal compressors, gas and process compressors, air and gas treatment equipment, expanders and pumps, and medical air solutions. It also provides oil-sealed rotary vane, dry, and liquid ring vacuum pumps; turbomolecular and cryogenic pumps; abatement and integrated systems; industrial assembly tools and solutions; self-pierce riveting solutions; adhesive dispensing and flow drill fastening equipment; material removal tools, and drills and other pneumatic products; machine vision solutions; construction and demolition tools; mobile compressors, generators, and energy storage systems; and industrial flow, portable power, portable flow, and portable air products, as well as specialty rental services. The company serves the semiconductor and flat panel, industrial manufacturing, civil engineering, demolition, exploration drilling, automotive, off-highway vehicles, electronics, aerospace, energy, food, pharmaceutical, textile, and other industries. Atlas Copco AB was founded in 1873 and is headquartered in Nacka, Sweden.
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