Eastern (NASDAQ:EML – Get Free Report) and Highway (NASDAQ:HIHO – Get Free Report) are both small-cap industrials companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, risk, valuation and dividends.
Insider and Institutional Ownership
77.0% of Eastern shares are held by institutional investors. Comparatively, 13.2% of Highway shares are held by institutional investors. 18.4% of Eastern shares are held by insiders. Comparatively, 32.1% of Highway shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Eastern and Highway’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Eastern | 3.44% | 3.38% | 1.89% |
| Highway | -28.08% | -25.93% | -15.72% |
Dividends
Analyst Ratings
This is a summary of current recommendations and price targets for Eastern and Highway, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Eastern | 0 | 2 | 0 | 0 | 2.00 |
| Highway | 1 | 0 | 0 | 0 | 1.00 |
Risk and Volatility
Eastern has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Highway has a beta of 0.48, indicating that its stock price is 52% less volatile than the S&P 500.
Earnings & Valuation
This table compares Eastern and Highway”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Eastern | $248.97 million | 0.68 | $7.13 million | $1.34 | 20.85 |
| Highway | $5.26 million | 0.81 | -$1.52 million | ($0.32) | -2.87 |
Eastern has higher revenue and earnings than Highway. Highway is trading at a lower price-to-earnings ratio than Eastern, indicating that it is currently the more affordable of the two stocks.
Summary
Eastern beats Highway on 10 of the 14 factors compared between the two stocks.
About Eastern
The Eastern Company designs, manufactures, and sells engineered solutions to industrial markets in the United States and internationally. The company offers turnkey returnable packaging solutions, which are used in the assembly processes of vehicles, aircraft, and durable goods, as well as in production processes of plastic packaging products, packaged consumer goods, and pharmaceuticals; designs and manufactures blow mold tools and injection blow mold tooling products, and 2-step stretch blow molds and related components for the stretch blow molding industry; and supplies blow molds and change parts to the food, beverage, healthcare, and chemical industries. It also provides rotary latches, compression latches, draw latches, hinges, camlocks, key switches, padlocks, and handles; and development and program management services for custom electromechanical and mechanical systems for original equipment manufacturers (OEMs) and customer applications. In addition, the company designs and manufactures proprietary vision technology for OEMs and aftermarket applications, as well as offers aftermarket components to the heavy- and medium-duty truck, motorhome, and bus markets. The Eastern Company was founded in 1858 and is based in Shelton, Connecticut.
About Highway
Highway Holdings Limited, together with its subsidiaries, manufactures and supplies metal, plastic, electric, and electronic components, subassemblies, and finished products for original equipment manufacturers (OEMs) and contract manufacturers. It operates through two segments, Metal Stamping and Mechanical OEM; and Electric OEM. The company also trades in plastic injection products; and manufactures and assembles automation equipment. Its products are used in the manufacture of products, such as photocopiers, laser printers, print cartridges, electrical connectors, electrical circuits, vacuum cleaners, LED power supplies, stepping motors, pumps for dishwashers, and other washing machine components. In addition, the company assists customers in the design and development of the tooling used in the metal and plastic manufacturing process, as well as provides an array of other manufacturing and engineering services, including metal stamping, screen printing, plastic injection molding, pad printing, and electronic assembly of printed circuit boards. It operates in Hong Kong and China, Europe, North America, and other Asian countries. Highway Holdings Limited was incorporated in 1990 and is headquartered in Sheung Shui, Hong Kong.
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