Subaru (OTCMKTS:FUJHY – Get Free Report) and Thor Industries (NYSE:THO – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.
Risk & Volatility
Subaru has a beta of 0.36, meaning that its stock price is 64% less volatile than the S&P 500. Comparatively, Thor Industries has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500.
Dividends
Subaru pays an annual dividend of $0.22 per share and has a dividend yield of 2.7%. Thor Industries pays an annual dividend of $2.08 per share and has a dividend yield of 2.9%. Subaru pays out 55.0% of its earnings in the form of a dividend. Thor Industries pays out 90.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Thor Industries has raised its dividend for 15 consecutive years. Thor Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Subaru | $31.79 billion | 0.37 | $599.56 million | $0.40 | 20.45 |
| Thor Industries | $9.58 billion | 0.39 | $258.56 million | $2.31 | 31.21 |
Subaru has higher revenue and earnings than Thor Industries. Subaru is trading at a lower price-to-earnings ratio than Thor Industries, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
0.0% of Subaru shares are owned by institutional investors. Comparatively, 96.7% of Thor Industries shares are owned by institutional investors. 4.7% of Thor Industries shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Subaru and Thor Industries, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Subaru | 1 | 1 | 0 | 0 | 1.50 |
| Thor Industries | 0 | 11 | 3 | 0 | 2.21 |
Thor Industries has a consensus price target of $92.33, suggesting a potential upside of 28.06%. Given Thor Industries’ stronger consensus rating and higher probable upside, analysts plainly believe Thor Industries is more favorable than Subaru.
Profitability
This table compares Subaru and Thor Industries’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Subaru | 1.77% | 3.01% | 1.56% |
| Thor Industries | 2.67% | 5.74% | 3.51% |
Summary
Thor Industries beats Subaru on 14 of the 17 factors compared between the two stocks.
About Subaru
Subaru Corporation manufactures and sells automobiles and aerospace products in Japan, rest of Asia, North America, Europe, and internationally. It operates through three segments: Automotive, Aerospace, and Others. The company manufactures, sells, and repairs passenger cars and their components, aircrafts, aerospace-related machinery, and related components; and rents and manages real estate properties. It is also involved in the shipping, land freight, and warehousing of vehicles; leasing and rental of vehicles; credit and financing of vehicles; inspection, service, and maintenance of aircrafts; and IT system development and operation services. The company was formerly known as Fuji Heavy Industries Ltd. and changed its name to Subaru Corporation in April 2017. The company was founded in 1917 and is headquartered in Tokyo, Japan.
About Thor Industries
THOR Industries, Inc. designs, manufactures, and sells recreational vehicles (RVs), and related parts and accessories in the United States, Canada, and Europe. The company offers travel trailers; gasoline and diesel Class A, Class B, and Class C motorhomes; conventional travel trailers and fifth wheels; luxury fifth wheels; and motorcaravans, caravans, campervans, and urban vehicles. It also provides aluminum extrusion and specialized component products to RV and other manufacturers. The company provides its products through independent and non-franchise dealers. THOR Industries, Inc. was incorporated in 1980 and is based in Elkhart, Indiana.
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