Analyzing Komatsu (OTCMKTS:KMTUY) & Gates Industrial (NYSE:GTES)

Komatsu (OTCMKTS:KMTUY – Get Free Report) and Gates Industrial (NYSE:GTES – Get Free Report) are both industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Institutional & Insider Ownership

0.2% of Komatsu shares are held by institutional investors. Comparatively, 98.5% of Gates Industrial shares are held by institutional investors. 2.9% of Komatsu shares are held by insiders. Comparatively, 2.8% of Gates Industrial shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Komatsu and Gates Industrial, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Komatsu 0 1 0 2 3.33
Gates Industrial 0 3 9 0 2.75

Gates Industrial has a consensus price target of $32.45, suggesting a potential upside of 25.79%. Given Gates Industrial’s higher probable upside, analysts clearly believe Gates Industrial is more favorable than Komatsu.

Profitability

This table compares Komatsu and Gates Industrial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Komatsu 8.93% 10.51% 5.93%
Gates Industrial 10.37% 10.11% 5.27%

Risk and Volatility

Komatsu has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500. Comparatively, Gates Industrial has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.

Earnings and Valuation

This table compares Komatsu and Gates Industrial”s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Komatsu $27.45 billion 1.56 $2.48 billion $2.73 16.91
Gates Industrial $3.50 billion 1.86 $251.40 million $1.41 18.30

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

Summary

Komatsu beats Gates Industrial on 8 of the 15 factors compared between the two stocks.

About Komatsu

(Get Free Report)

Komatsu Ltd. manufactures and sells construction, mining, and utility equipment in Japan, the Americas, Europe, China, Rest of Asia, Oceania, the Middle East, Africa, and CIS countries. It operates through three segments: Construction, Mining and Utility Equipment; Retail Finance; and Industrial Machinery and Others. The company offers construction and mining equipment, including excavators, wheel loaders, bulldozers, motor graders, dump truck, rope and hybrid shovels, electric wheel loaders, continuous miners, and jumbo drills. It also provides forestry equipment, including harvesters, forwarders, feller bunchers, excavators, mini excavators, and forklifts; demolition, waste, and recycling equipment, such as mobile crushers, hydraulic excavators, wheel loaders, and mini shovels; material handling equipment; and tunnel-boring machines, pipe layers, towing tractors, and engines. In addition, the company offers industrial machinery, including presses, sheet-metal machinery, 3D laser cutting machine, transfer machines, battery manufacturing equipment, wire saws, thermos modules, thermoelectric generation module, and temperature control products; quarry equipment; agricultural and livestock equipment; EH sensor device; iron and steel casting products; and logistics equipment. Further, the company provides retail financing; construction machinery rental services; remanufactured products; other support services; transportation, warehousing, packing, and other services; and purchases and sells used equipment. Komatsu Ltd. was founded in 1884 and is headquartered in Tokyo, Japan.

About Gates Industrial

(Get Free Report)

Gates Industrial Corporation PLC designs and manufactures power transmission equipment. Its products serves harsh and hazardous industries such as agriculture, construction, manufacturing and energy, to everyday consumer applications such as printers, power washers, automatic doors and vacuum cleaners and virtually every form of transportation.

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